Can a Digital Check Be Deposited Again
Can someone cash your check more than than in one case? Yep, cheers to the intersection of very sometime and very new banking technology. Impossible until recently – payees formerly were required to hand newspaper checks over to banks during a deposit – some experts predict "double presentment" volition be the source of a new fraud wave coming soon. And if you lot don't know near it, even if yous don't use mobile banking, y'all might have to pes the bill.
It happened to Louise Moon Rosales of Vermont. Twice in the past twelvemonth, she wrote checks to pay for small services such every bit yard work. Both were cashed…so cashed a second time a few months later. Her banking concern honored both payments. For example: a $100 bank check she wrote to a high schoolhouse pupil for g work was cashed in December, and and then over again in Apr. How?
The student used a new, popular checking account tool called "remote deposit capture" — he deposited the check with his cell phone. Cheque recipients who do that get to go along the paper bank check, rather than hand it over to a teller or an ATM. That ways the bank check tin be deposited a second time, a problem known in banking every bit "double presentment."
"I totally could take missed it," Rosales said. "If didn't use Quicken I would have….I use online Quicken to reconcile the accounts, and that is how I found it."
It seems almost too simple: criminals re-depositing the same check multiple times. But with the meteoric rise of remote deposit capture and mobile banking– some analysts call up half of all retail deposits will employ the technology past next year — banks are racing to compete with each other to offer the service. That ways they are beginning to favor speed over prophylactic.
And there's some other element which makes mobile banking ripe for the next wave of fraud, predicts analyst Shirley Inscoe of Aite Group. With chipped "EMV" credit card chips finally condign a reality in the U.S., eliminating i popular kind of fraud, criminals will aggressively hop to another technique to replace lost income.
"I predict that organized fraud rings – which will be actively looking for new targets as EMV becomes more than fully implemented – will discover (mobile remote deposit capture) in a big way," she said.
Spotting fraud takes time, and use of fraud-fighting technologies is always a tight balancing act of convenience vs. security. It seems logical that a banking company would speedily scan check numbers to make certain the exact same check hasn't been deposited before, but for pocket-sized dollar amounts, even that level of delay can be seen as unnecessary. Nevertheless, banks accept historically been practiced at catching double presentment at the same institution using the same channel — the same check deposited twice using the same mobile phone, for case — says analyst Bob Meara of Celent.
Merely if criminals use dissimilar channels — get-go time on a phone, 2nd time at an ATM — that gets a little trickier.
And depositing the aforementioned check into multiple different checking accounts at multiple banks? Well, that's a big problem.
"Even the nigh rigorous deposit review mechanisms are powerless to identify and turn down items that have been previously deposited at other financial institutions," Meara writes in a recent report.
Part of the problem involves honest mistakes, which turned out to be the source of Rosales' trouble. I check was refunded past the bank, the other by the student. "Accidental double presentment" occurs when a consumer isn't sure if she/he (or a spouse) previously cashed a check. The trouble is a new one for consumers, who aren't used to hanging onto concrete checks after they've been cashed. Some banks tell consumers to agree on to the paper for a calendar month or more, leading to inevitable defoliation over what'southward been cashed and what hasn't.
Until recently, banks take been very judicious about granting remote deposit privileges to account holders, which has kept fraud rates very low. Tenure with the institution, deposit history, and average daily balances have all dictated which consumers or businesses were granted mobile deposit eligibility. Banks have too established low maximum daily deposit limits, another disincentive for fraud. Meara says fraud has been extremely low.
"Indeed, banks wish credit card portfolios would perform in such a fine style," he said. Mobile deposit security technologies are "light years ahead of what was one time status quo: taking manual deposits at the branch."
But with the new, highly competitive surroundings, pressure to accept remote deposits from anyone…and for high deposit limits…has led to lowering of standards, Inscoe said. That ways more fraud, Inscoe warns.
"As I continue talking with financial institution execs, I am hearing that more and more than banks are dropping the requirement that an business relationship be opened for a specific period of time before being eligible for MRDC due to competitive pressures. As that requirement is dropped, fraud is becoming quite a problem," she told me. "At some point, the need for fraud relief may outweigh the competitive pressures and force banks to reinstate the new account 'wait catamenia' earlier allowing customers to use MRDC."
RED Tape WRESTLING TIPS
Watch for checks cashed twice! Consumers should take heed of Rosales' lesson. If she didn't take hold of the double withdrawals, she would exist out the money. Don't rely on your banking concern's department to grab the trouble.
Even if you don't employ mobile banking, yous can be a victim. It's also incredibly important to understand that you can exist a victim of double presentment even if don't utilise online banking or mobile banking. All that matters is the criminal/absent payee uses remote deposit capture. All y'all have to practice is write an old-fashioned check to be victim or the latest cyberbanking fraud.
Source: https://www.geekwire.com/2015/the-next-fraud-wave-when-banks-cash-the-same-check-twice-you-might-have-to-pay/
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