FRAUD SEASON IS HERE!!

Special to BaltimoreMD.com

By James A Blanco

     "Tis the season to be wary, Fraud-la-la-la-la, la-la-la-la."

     Such might be the new refrain for the period stretching from Thanksgiving through Christmas to New Year's Day, according to a veteran fraud investigator.

     There's more fraudulent activity in the holiday season than at any other time of year," says James A Blanco, a former U.S. Treasury Department documents examiner. "Everybody's out shopping; well, the fraud artists are out shopping too. Because so much money is changing hands so rapidly, in the form of checks, credit cards and other negotiable instruments, it's hard for store clerks and others to pay careful attention."

     "More than 1.4 million checks are forged every day in this country," Blanco asserts, "causing $27.3 million in daily losses to American businesses. Of course, a disproportionate part of those bad checks and those cash losses occur in November and December, our heaviest retail period."

     Throngs of shoppers jamming up to cash registers put clerks and tellers at a great disadvantage. The crunch can intimidate them into skipping over simple precautions capable of blocking the passing of worthless checks and bogus credit cards. Returns counters, too, can become mad houses, and allow scam artists using counterfeited purchase receipts to walk away with cash as they "return" items they have shoplifted.

     Holiday fraud is also abetted by experienced help wanting to take some time off and rookie clerks being thrown into the melee of swarming customers. This season is also a time when people allow good habits practiced during the rest of the year to lapse because they are distracted by their own holiday concerns, shopping, parties, and other events.

     Therefore, prior to the Thanksgiving holiday, Blanco advises, company owners and managers should rehearse policies and procedures regarding cash register and record keeping practices with seasonal or less experienced help. "Review the scams that can be perpetrated against your business and explain what the employees can do to be vigilant," he suggests. Any extra help taken on during the holidays will need to be monitored regularly until precautionary procedures become habitual, he adds.

     As law enforcement agencies around the country are swamped with fraudulent cases particularly this time of year, Blanco's motto to remember is, "Retention is better than Apprehension." That is, it is better to prevent fraud in the first place than trying to retrieve that which you have lost to a scam artist.

Blanco's FRAUD PREVENTION tips for businesses likely to be victims of the holiday scammers:

Authenticate Checks:

Verify Negotiable Instruments:

  • Make sure that the Cashier's Checks, Money Order or Traveler's Check was not color copied. If it was, then it is bogus; and you can take that to the bank!
  • Call your own bank officer to validate the tendered negotiable instrument. Set up this arrangement ahead of time and have the phone number and contact person readily available to your clerks.

Authenticate Cash:

  • Hold the denomination up to the light and check for the watermark (new bills)
  • Insure that the numeric value matches from the front to the back.
  • Ignore the wives tale that ink will smear on a bogus bill if rubbed as ink may smear on authentic currency as well.
  • Review the safety features of the old as well as the new denominations.
  • Contact your local office of the Secret Service and ask for a pamphlet on how to detect the differences.

Validate Credit and Debit Cards:

  • Make sure the card is signed on the back. You will be responsible for the loss due to fraud if you do not follow practices dictated by your merchant agreement.
  • Insure that the name, gender and age of the presenter match the information on the tendered card and identification.
  • -Check holograms which should be crisp and squarely placed on the card.

Authenticate your own merchandise receipts before accepting merchandise returns:

  • Train your returns counter personnel in the identifying features of your register receipts. These are routinely counterfeited and if not validated, you will be giving away cash or product to a rip-off artist.
  • Insure that cash drawers are not left propped open, particularly in Taverns and Restaurants. This will help prevent cash pilphering scams.

Other Suggestions: