Forge Me if You Can
While banks may not be overly concerned about security, to consumers check security is vital, even if they are not aware of it. Many underestimate the potential problems caused by security holes. Especially under the new legislation, measures to prevent fraud are crucial. Distributors need to know of potential problems and know how to address security concerns even while juggling new design requests. Distributors who take the time to learn about security and fraud liability law may find many new customers who will be thrilled to learn how to protect themselves and will be happy to buy from a distributor who prevented potentially massive problems.
Noting the motivations for the Check 21 Act will help distributors understand the need for enhanced security. Check 21 was enacted to increase efficiency of money transfers and reduce costs; it was not intended to prevent fraud. Use of check images for nearly instant verification may prevent checks drawn on non-existent accounts from being paid and reduce theft or fraud during transit. However, there are many other methods of check fraud.
To learn about fraud, BFL&S spoke with Frank Abagnale, a consultant in document security and expert in methods of fraud and forgery. Abagnale is most known as the author and subject of Catch Me if You Can, which was made into a popular Steven Spielberg film. Abagnale is also the author of several books about fraud and identity theft. His renown in the security field comes from his ability to circumvent it. As a minor, Abagnale became one of the most notable, successful and notorious forgers ever. Those days are far behind him, but he continues to draw from his experiences to help law enforcement agencies and those in the private sector prevent the kinds of crimes that he himself once committed.
Abagnale had harsh words about the new legislation: “That is the stupidest law ... I sometimes sit back and ask myself ‘Do criminals have lobbyists in Washington?’” Sandy Horner, president of Diversiform Software Compatible Checks, Alexandria, Va., also noticed the problems with the new rules: “Golly,” she said with a strong dose of sarcasm, “that seems kinda counterproductive for security.”