There is no question about the importance of check security features that cover every transaction of checking account holders. This is further highlighted by the fact that according to Ernst & Young, there are over 500 million checks that are forged yearly amounting to losses approximating more than $10 billion. This has been upheld and substantiated by the American Banking Association with the added information that the alarming level rises at a rate of about 25% annually.
Taking these into consideration, the loss per check issued in the United States amounts to $1,545 on the average. Despite courts upholding the UCC (Uniform Commercial Code) for check fraud, it is still important for businesses and checking account holders to ensure that due care and diligence is exerted to ensure protection of such an important document. High value business checks may deserve multiple security features. Keep in mind that failure to ensure check security features can result in a shift of financial loss liability from the bank to the checking account holder.
It is therefore important to consider the following protection mechanisms.
Graduated color printing
One of the most common types of fraud committed against checks is that they are photocopied and passed on as originals. The easiest security measure to put in place to protect checking account holders from this type of fraud is to use checks that are printed with graduated colors. This is available in event the cheapest checks. The different versions make it quite difficult to photocopy outright especially when using proprietary printing technology that makes it easy to distinguish between an original and a photocopy.
Void feature
One of the preferred types of check security features; it makes use of multiple pantograph check designs that are incorporated into the check itself. This feature can often be seen around the signature area as well as the line where the amount of the check is written. The feature includes an intricate design feature that results in the word void appearing in a series if the check has been processed using a single or even full color copier.
This means photocopying or scanning and printing of the original check becomes impossible. The technology makes use of the different color settings found in copiers and scanners.
Protecting the amount line and signature area
There is no doubt that two of the most important areas in any check would have to be the amount line and the signature area. In order to protect checking account holders from potential scams and frauds, many legitimate check printers institute security measures that protect these sensitive areas. The practice is to use backgrounds for the specified areas that will make it difficult to reproduce the original check without alteration.
This patented technology that relies on the implementation of multiple pantograph designs makes use of different density settings commonly found in equipment that are used to implement check fraud. Sometimes a warning clause is included in the signature area to inform the recipient that the signature area should have a visible colored background.
Micro printing technology
Sometimes one of the best protection mechanisms that can be employed for bank checks is to use micro printing technology. With this security measure, the line borders would appear solid to the naked eye, but in reality, they are micro printed with words like Safe Check, which is only visible when subjected to magnification.
Sometimes even the endorsement area is treated with this type of technology. This is the same type of security feature that is currently implemented in United States currencies in circulation.
Check endorsement clause of the ABA
Another one of the check security features that can prove to be useful against scams and fraud would be the use of a security seal combined with fingerprint protection. These are incorporated using heat sensitive ink around the endorsement clause that appears on the back of the bank check. The use of this protection mechanism is normally accompanied by a warning clause.
The value of the warning clause is that it notifies all holders and cashing parties that the face of the check should be colored. Furthermore, it instructs them that rubbing or breathing on the fingerprint or the seal will make the heat sensitive ink disappear. The absence of the security features can be used as grounds to nullify the legitimacy of the bank check. The recipient of the check will also be informed on how the watermark should appear.
The use of watermark
The implementation of a watermark certification seal is an approved practice by the EPA. This means that all checks protected by this measure will bear a watermark certification seal with an accompanying fingerprint at the back together with the proper warning clauses clearly printed both on the front and the back.
The watermark also informs banking institutions that the paper used for the bank check meets all the necessary specifications for the execution of laser check printing technology.
Fluorescent fibers
Among the more innovative check security features would have to be the inclusion of fluorescent fibers in the paper used for the printing of the check. This security technology normally makes use of multiple artificial fluorescent fibers that are scattered on the surface of the bank check. When subjected to black light, the fluorescent fibers will become intensified ensuring that authentic paper is used and certifying the legitimacy of the bank check.
Heat sensitive colors
An innovative security feature that is implemented for both the front and back faces of the bank check is the use of heat sensitive colors. This means that both faces are separated by pink thermochromatic ink that is designed to disappear when the bank note is subjected to temperatures beyond 85 degrees Fahrenheit. Normally, separate colors are used for the front and back face of the bank check.
This means that by simply looking at the color of the check, a recipient will be able to identify if the bank check is authentic or not. Moreover, the benefit is that the check will be protected from any type of photocopying or scanning technology. Because the ink used is heat sensitive, it would be virtually impossible to recopy the bank check without the color disappearing.
The use of warning clause
One of the more standard security features found on different bank notes like checks is the printing of the U.S. Patent numbers. These numbers are printed on the left margin of the face of the check using thermochromatic technology. The warning clause explicitly states that absence of the U.S. Patent numbers at the left margin indicates that the check is considered fraudulent.
To avoid accidental erasure, the warning also states that the ink will disappear once it is subjected to rubbing or blowing.
With the Supreme Court deciding that failure to exercise due diligence in securing your documents can result in the checking account holder being held liable rather than the banking institution, becoming aware of various check security features becomes extremely important.