Dear Dr. Per Cap:

I still write checks to pay bills, but my son says I’m wasting time, paper, and stamps.  He also says checks are easy to steal.  Should I stop writing checks and switch to online bill payments?

Signed,

Checking In

Dear Checking In

Your son is part of a growing majority of consumers who are dumping checkbooks in favor of electronic transactions.  In fact several years ago a Federal Reserve study revealed that paper checks were only written to pay 7% of all consumers’ bills. 

And yes, there has been a frightening increase in check fraud in recent years, especially among age affluent elders who are more likely to use checks.  What often happens is criminals steal signed checks from envelopes inside mailboxes.

It’s frightening what a determined thief can do with a few dabs of Wite Out or nail polish remover.  They just remove the dollar amount and the name after “Pay to the Order of”, write in a new name and amount (usually a much larger number than the original), and go cash the doctored check.

However, the decision to stop writing checks altogether is a really tough call that puts me on the fence.  That’s because while check fraud is a very real risk, electronic payments present a whole different set of risks.  Fake URL’s and phony apps, cyberattacks, poorly protected WiFi networks, and a host of other tech glitches and vulnerabilities has allowed fraud to run amok in many segments of the electronic payments realm too.

What I will say is that if you continue to write checks, make sure to take extra precautions.  For starters never drop an envelope that contains a check into an unlocked mailbox.  It’s also a good idea to wait until just before the last pick up of the day to deposit your mail.  Or better yet hand-deliver your bills in the mail slot inside your local post office.

Also don’t sign your checks with any old pen you have laying around.  Instead use a fraud proof pen that contains special ink that is both waterproof and fade proof.  This will make it a lot harder for criminals to bleed your bank account dry with the “check washing” techniques described above.

For more tips on how to protect against check fraud or to report a check washing crime, check out the United States Postal Inspection Service website.  Cheesy pun intended!

Ask Dr. Per Cap is a program funded by First Nations Development Institute with assistance from the FINRA Investor Education Foundation. For more information, visit www.firstnations.org. To send a question to Dr. Per Cap, email askdrpercap@firstnations.org.