Remote Deposit Capture (RDC) has revolutionized check processing, offering speed and convenience while reducing the need for trips to the branch.
But with that convenience comes exposure. Without the proper barriers, RDC can open the door to serious financial and compliance risks.
That's why adopting clear, enforceable remote deposit capture best practices is essential.
In this article, we'll explore the best practices that make RDC secure, compliant, and built to last.
Remote Deposit Capture (RDC) is a technology that enables users to scan checks and send the images electronically to their bank for deposit.
RDC eliminates the need for physical visits to a branch, allowing businesses and individuals to deposit funds from their office, home, or even on the go via a mobile device.
RDC has become essential for organizations seeking greater efficiency, flexibility, and improved cash management.
The benefits of RDC include:
However, with these advantages come new responsibilities – particularly in terms of security.
In 2024, 65% of financial institutions reported experiencing check fraud through Remote Deposit Capture, and 80% of organizations faced attempted fraud via mobile deposits.
A 2025 AFP survey also found that 63% of companies experienced check fraud during 2024, highlighting the growing risks associated with remote deposit channels.
The numbers make the case: check fraud is rising even as check usage declines.
Before implementing controls, it's essential to understand the primary risks associated with Remote Deposit Capture. Fraud tactics are constantly evolving, so banks must remain vigilant and adapt accordingly.
Common RDC fraud types:
These frauds exploit the fact that RDC deposits are often reviewed by automated systems or back-office staff rather than by tellers, who might spot suspicious signs, such as a fake signature or poor-quality paper.
Emerging fraud trends:
A key theme in these scams is avoiding detection. FinCEN reports that criminals prefer RDC and ATM deposits because no one physically handles the checks at the bank.
Other important risks:
The following practices address key vulnerabilities to keep RDC secure, efficient, and compliant:
Proper identity and risk screening is the first and most crucial step in preventing RDC fraud.
Banks should confirm each customer's identity, creditworthiness, and deposit behavior before granting RDC access. Periodic reviews help catch anomalies over time.
Screening filters out risky customers upfront, reducing exposure. Clear contracts align expectations and liability.
Restrictive endorsements, such as "For Remote Deposit Only," prevent redeposit and reduce the risk of fraud.
Physical checks must be securely stored immediately after imaging with controlled, dual-person handling.
Restrictive endorsements and strict handling block duplicate deposits and internal theft.
Retain paper checks only as long as needed for audit and compliance (typically 30–60 days).
Mark checks as void and securely shred them after the retention period has expired.
Consistent retention and destruction prevent reuse or fraud while supporting compliance audits.
Real-time risk scoring, utilizing advanced image analysis and behavioral insights, prevents fraudulent deposits before funds are credited.
This proactive approach significantly reduces losses and enhances customer trust by minimizing unnecessary holds.
Instant insights allow banks to act before funds settle, stopping most fraud in its tracks.
Leading banks use VALID Systems' CheckDetect to flag over 75% of high-risk checks on deposit, enabling immediate intervention.
RDC devices and networks are prime targets for hackers aiming to compromise sensitive financial data or inject fraudulent checks.
If you don't have strong IT security, fraud risks skyrocket, and you jeopardize regulatory compliance.
Strong security reduces the risk of remote account takeover and unauthorized access.
Human alertness is the frontline defense.
Well-informed customers reduce accidental errors, and trained staff can quickly identify suspicious deposits, stopping fraud before losses occur.
Informed users prevent accidental fraud and reduce bank losses.
Setting limits and holds based on customer risk helps prevent large fraudulent deposits.
It also ensures compliance with funds availability rules while maintaining a smooth customer experience.
Limits and holds give banks time to verify questionable deposits before releasing funds.
Automated systems help detect duplicate deposits, unusual patterns, and suspicious behaviors that humans might miss.
Real-time monitoring catches fraud early, minimizing financial losses.
Consider adding VALID's INclearing Loss Alerts, which employ machine learning and behavioral analytics to detect complex fraud that may be missed in front-end screening.
Innovative solutions enable banks to offer faster funds to low-risk deposits while holding risky items for review, thereby improving the customer experience without increasing fraud risk.
Dynamic funding maximizes customer convenience and fee income while sharply reducing fraud exposure.
Top banks use InteliFUNDS, which instantly accelerates 99% of low-risk checks (while covering any that return unpaid), and InstantFUNDS, which offers same-day funded options backed by guaranteed fraud protection.
Implementing all these practices is easier when you have the right technology partner.
VALID Systems is at the forefront of next‑gen RDC fraud prevention, with proven products designed around these very best practices. We blend industry expertise with cutting-edge AI to build trust in every check deposit.
With over two decades of innovation in check fraud detection, VALID equips financial institutions with real-time intelligence, automated decisions, and risk-aware funding strategies. The result? Stronger fraud defenses without slowing down the customer experience.
Our main products:
CheckDetect scans each deposit in real-time and flags high-risk checks with exceptional accuracy.
It learns patterns of fraud from a consortium of customers (over 420M accounts and $6T processed annually in VALID's network), so it "alerts you to over 75% of potential check deposit charge-offs" before they happen. Banks using CheckDetect have dramatically reduced fraud losses because they can intervene instantly.
This solution transforms check holds into customer value. InstantFUNDS approves a deposit, providing the customer with immediate access to funds (often for a small fee), and mitigates the bank's risk by covering any returned items through VALID's guarantee.
In effect, customers get the fastest availability, banks earn fee revenue, and everyone avoids post-deposit hassles. This best-in-class approach turns a traditional pain point (long holds) into a competitive offering.
Perhaps the most revolutionary innovation, InteliFUNDS acts like a personal decision engine for each check. It utilizes machine learning models and rules to process 99% of safe deposits instantly, identifying only the riskiest ~1% to hold.
The benefit is twofold: end-users get the seamless RDC experience they expect, and banks tighten their fraud belt with minimal inconvenience.
Ready to modernize your RDC risk strategy?
Book a consultation and let VALID Systems help you prevent losses, reduce friction, and stay ahead of fraud.