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The FinCEN (Financial Crime Enforcement Network) issues an alert to all the FIs (Financial Institutions) on the nationwide surge in check fraud schemes that target U.S Mail.
Check fraud is the largest avenue of illegal proceeds in the US and is one of the main concerns of AML/CFT regulatory authorities. USPIS (United States Postal Inspection Service) in coordination with FinCEN identified several red flags to assist FIs to detect and prevent these kinds of suspicious activity regarding mail theft and check fraud.
“FinCEN is proud to partner with the United States Postal Inspection Service in producing this important and timely alert on mail theft-related check fraud designed to assist financial institutions in reversing this disturbing trend,” stated Acting Director Himamauli Das.
He added, “Their vigilance and timely reporting will help law enforcement identify illicit actors who steal mail with the goal of defrauding innocent American taxpayers and businesses.”
To commit check fraud, criminals target the U.S Mail and USPS (United States Postal Service) mail carriers since the pandemic. They typically steal personal, business, and tax refund checks. Also targeting checks related to government assistance programs, such as Social Security Payments and unemployment benefits.
Following the initial theft and fraudulent negotiation on stolen checks, Fraudsters may continue to exploit their victims using the personally identifiable information found in stolen mail to be used in future fraud schemes, such as credit card or credit account fraud.
The BSA (Bank Secrecy Act) reporting for check fraud has risen significantly in the last three years. In 2021, financial firms filed over 350,000 SARs (Suspicious Activity Reports) to FinCEN to mention potential check fraud which is a 23% rise in the total number of SARs filed over check fraud in 2020.
This surge continued in 2022 when the number of SARs related to check fraud reached over 680,000. This figure is nearly double the previous year’s (2021) amount of filings.
FINCEN ALERTS FIS OF SANCTION EVASION BY RUSSIAN ENTITIES IMPLICATED IN U.S. COMMERCIAL PROPERTY INVESTMENTS