Check Fraud Statistics 2025: Trends, Data & Insights

Checks are still part of how businesses move money, even if they seem outdated.

Statistics from 2024 indicate that 91% of organizations continue to use checks, up from 75% the previous year. At the same time, check fraud surged, with 63% of companies reporting incidents (AFP).

The reality is clear: checks remain in circulation, and the associated risks are not only persistent – they're becoming more sophisticated.

This article breaks down the latest check fraud statistics, key trends behind the rise, and what banks can do to stay ahead of evolving fraud tactics.

The persistent threat of check fraud

Check fraud is a deceptive act involving the use of checks to obtain money or property unlawfully.

Checks once dominated U.S. payments, reaching a peak in the early 1990s with over 16 billion processed annually. While volumes have declined, their role hasn't vanished, especially for high-value transactions. Despite digital alternatives, many businesses still cut checks for high-value transactions. And where money moves, fraud follows.

Today's most common check fraud methods involve:

• Counterfeit checks: Fraudsters print fake checks that mimic legitimate ones.
• Altered checks: Fraudsters exploit real checks by altering the payee name or the amount.
• Forged endorsements: Checks cashed or deposited with a fraudulent signature.
• Check washing: Chemicals erase the original ink, allowing altered details to be written in.
• Remote Deposit Capture (RDC) fraud: The same check is deposited multiple times via mobile apps.
• Synthetic identity fraud: Fraudsters use a blend of real and fake information to create new, fraudulent identities. Synthetic identity fraud, increased by 37% year-over-year in 2024, as criminals leveraged AI to create convincing fake identities.

Check fraud statistics in 2025

Let's take a closer look at what recent industry data tells us about the state of check fraud in 2025:

• Federal Reserve Survey (2024): The number of financial institutions experiencing attempted check fraud grew by 10% from 2023 to 2024.
• Jack Henry (2024 Benchmark): 75% of U.S. banks and credit unions cited check fraud as a major concern for their institution. Industry analysts also note check fraud comprises roughly 60% of all attempted fraud against U.S. financial firms.
• Alloy Report (2024): Over 50% of financial institutions reported rising fraud targeting both businesses and consumers, with 25% experiencing fraud losses exceeding $ 1 million.
• DataVisor/PwC (2025): 80% of financial firms list check fraud as a priority concern. Experts warn it's becoming "more democratized" via social platforms.
• FTC/KPMG (USA): Consumer and corporate fraud losses reported to the FTC in 2024 hit $12.5 billion – a 25% jump from 2023. Bank transfers and cryptocurrency transactions resulted in the most significant losses, underscoring a more expansive rise in fraud across all payment methods.
• CIFAS (UK): Globally, fraud is surging too. In 2024, UK organizations reported a record 421,000 fraud cases (an increase of 13% from 2023) to the Cifas database, which prevented over £2.1 billion in losses. (While UK stats don't single out checks, they show how widespread fraud trends are abroad.)

Check Fraud Summary: 2023–2025

Crucial factors behind the rise in check fraud

Collectively, these data indicate that check fraud remains high in 2025, particularly in the United States.

Several factors explain why check fraud is rising now:

Social media and messaging networks

Fraudsters openly share stolen checks and new schemes on Telegram, WhatsApp, and other platforms.

This "democratization" of check fraud tools (templates, stolen MICR numbers, wash kits) means even amateur criminals can perpetrate check scams.

Advanced forgery technology

Modern printing and AI enable the creation of highly sophisticated counterfeits.

High-resolution printers, scanners, and even AI-based handwriting generation tools enable fraudsters to replicate logos, holograms, and signatures with near-perfect accuracy. Fraudsters use these tools to bypass banks' manual reviews.

Mail theft and "check washing"

U.S. mail theft has spiked.

Criminals are stealing business checks right out of mailboxes and vehicles, then washing and redepositing them.

One major case occurred in Montgomery County, Maryland, where two women led a $500,000 fraud scheme by using a stolen USPS arrow key to access mailboxes. They stole business checks, altered them with specialized tools, and attempted to cash or circulate them.

New consumer scams

Check fraud often ties into broader scams rather than being a standalone scheme.

Romance scams, fake job or secret shopper scams, and business email compromises sometimes trick victims into depositing phony checks or sending funds via check. Each new scam floods the system with fresh fraudulent checks.

Insider and collusive fraud

Weak internal controls continue to expose businesses to insider threats. In a 2025 case, Heather Murdock, a bookkeeper at a Hartford law firm, was indicted for embezzling over $840,000.

She created fake checks, forged signatures, and manipulated accounting records to cover her tracks. The fraud spanned years and went undetected due to her unchecked access to financial systems.

Best strategies to prevent check fraud in 2025

Each tactic below addresses a common weak spot that fraudsters often exploit, providing you with practical ways to strengthen your defenses:

1. Deploy AI-based image analysis

By implementing AI image analysis, banks can catch forgeries that manual reviews overlook, such as AI-generated handwriting, altered fonts, and subtle layout changes.

This technology compares each check to known authentic patterns in real-time, flagging high-risk items before they clear.

Best practices:

• Use forensic imaging software to scan and check images for inconsistencies in fonts, signature slant, spacing, and MICR lines.
• Automate deposit review across teller lines, ATMs, and mobile deposit channels.
• Train machine learning models to compare each new check against known-good samples to detect signs of tampering.

2. Use Positive Pay across all check types

Positive Pay remains a foundational defense, but its effectiveness depends on the depth of implementation. The more fields you validate, the harder it is for altered or counterfeit checks to clear.

Key actions:

• Apply Check Positive Pay to match the check number, dollar amount, and account info.
• Add Payee Positive Pay to validate the recipient's name.
• Use Reverse Positive Pay if your client prefers to review and clear files themselves.
• Secure on-us checks are manually verified at teller lines using updated issue files.

Pro tip:

Layering Positive Pay with AI-driven tools that analyze signature placement or font discrepancies significantly reduces manual errors and flags more forgeries, especially at the teller window.

3. Enable real-time alerts and monitoring

Fraud detection after the fact is too late. Today's fraud occurs rapidly – banks need tools that act in real-time, not overnight.

Steps to implement:

• Use in-flight fraud scoring tools that evaluate each check during the deposit process, not hours later.
• Monitor for behavioral patterns: unusual check values, rapid-fire deposits, or inconsistent payee names.
• Set rules to hold, reject, or escalate deposits instantly based on real-time risk scores.

Pro tip:

VALID's Real-Time Loss Alerts (RTLA) flag over 75% of fraudulent checks before they clear, helping your institution to stop losses at the point of deposit, not days later in reconciliation.

4. Offer guaranteed-funds products

Offering services that guarantee funds for verified checks can protect both financial institutions and customers from losses due to fraudulent checks.

Action steps:

• Use automated decision-making to prioritize low-risk checks for immediate approval.
• Flag and hold high-risk deposits for secondary review.
• Offer products that provide customers instant access to funds without exposing the bank to unchecked fraud.

Pro tip:

VALID's InstantFUNDS makes a sub-second decision and guarantees those funds – the bank and customer are protected if the check bounces.

Likewise, VALID's InteliFUNDS© promises instant credit on ~99% of checks and places a hold on the riskiest 1%, with VALID covering any bounced or fraudulent cleared items.

5. Leverage behavioral analytics and consortium intelligence

Fraud isn't limited to one bank.

Fraud rings often test the same stolen checks or compromised accounts across multiple institutions. Shared intelligence and behavior modeling are critical.

Next steps:

• Utilize behavioral analytics to identify suspicious patterns, such as account hopping, sudden increases in deposit velocity, or geographic anomalies.
• Monitor onboarding and early account activity for synthetic identity fraud.
• Tap into fraud data consortiums to detect recycled or flagged check numbers.

Pro tip:

VALID's INclearing Loss Alerts monitor activity across a shared data network, flagging suspicious check patterns, stolen item reuse, and multi-bank fraud strategies long before they hit your system.

VALID Systems: Your frontline defense against evolving check fraud

This article laid it out clearly – check fraud isn’t fading, it’s evolving, and the data proves it. Fortunately, the strategies outlined here show it's possible to get ahead of the threat.

VALID Systems empowers the shift from reactive fraud handling to proactive prevention.

For more than 20 years, VALID has helped banks stay ahead of check fraud – refining AI decision tools and building a risk catalog with 2.5 billion unique machine learning features. Today, 8 of the top 25 U.S. financial institutions trust VALID to protect their check operations.

Key VALID products:

• RTLA© (Real-Time Loss Alerts): Flags up to 95% of fraudulent checks in real time, reducing manual review and loss exposure.
• InstantFUNDS©: Approves low-risk checks instantly and offers customers immediate access to funds with optional convenience fees.
• InteliFUNDS©: Guarantees verified check deposits while holding high-risk items, protecting banks without sacrificing user trust.
• INclearing Loss Alerts: Monitors checks post-clearance, using behavior analytics to catch fraud missed during deposit.
• VALID Edge Data Consortium: Leverages insights from 420M+ accounts and $6T in transactions to detect fraud patterns early.

Are you still using outdated systems? Check fraud statistics show the risk is rising – why wait?

Schedule a demo with VALID and see why industry leaders trust us to stay ahead of today's most sophisticated check fraud tactics.