Prevention tips

The best way to reduce your losses is to avoid taking bad checks. The following tips are suggestions to help you establish good procedures for accepting checks.

Institute a check acceptance policy: A clearly posted check acceptance policy for your employees and customers can go a long way toward reducing your losses. Policies should state which types of checks are accepted and should include the consequences to bad check writers.

Confirm the identity of the check writer: All identification cards can be forged. The most reliable form of I.D. is one that contains a photo and a physical description. Take the I.D. in hand and write the I.D. number, birth date, address and other descriptive data on the front of the check. Ask questions. If the I.D. does not belong to the person writing the check, they might be thrown off guard.

Avoid accepting checks written on a new account: About 85 percent of all bad checks are written on accounts only a few months old and bear check numbers between 101 and 150. Use caution. Do not accept counter drafts.

Get someone’s John Hancock: The signature should be legible and signed in the presence of the individual accepting the check. Do not accept previously signed checks. For a company check, it is vital that the signature is legible. If not, print the individual’s name on the front of the check.

Return to sender: The complete address should be imprinted on the check. Require a street address, in addition to a P.O. Box number. Obtain a phone number as well.

Accept checks only written with today’s date: Pre- or post-dated checks are not accepted in the Bad Check Restitution Program and cannot typically be criminally prosecuted. This restricts any recourse you might have against the check writer if your collection attempts fail.

Make sure written amounts and numbers correspond: Banks will not honor checks with discrepancies between written amounts and numbers.

Avoid accepting checks drawn on an out-of-state bank.

Remember, you are not required to accept a check from anyone. If you feel uncomfortable or suspicious, trust your intuition.

Source: El Paso and Teller Counties Fourth Judicial District Bad Check Restitution Program

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