the bankruptcy system by people who can afford to pay their debts.
Nationwide, a new record high was set in the number of bankruptcy
petitions filed last year. The majority of consumer bankruptcy filings
are filed under Chapter 7 of the U.S. Bankruptcy Code, which allows
people to erase credit card and other debts. Chapter 7 filings during
the 12-month period jumped 17.2%, to 1,059,777. Creditors are woefully
familiar with Chapter 7 provisions, where, in return for having
their debts dissolved, debtors turn over their property to a bankruptcy
trustee, except for basic necessities such as a car or clothing.
Property with value is sold to pay creditors, typically pennies
on the dollar, if anything. By contrast, nationwide filings under
Chapter 13—in which people repay debts over time in accordance
with a court-approved plan—rose 10.2% to 433,107.
Check Fraud: Hints for Avoiding Losses
It can’t be stressed enough that check fraud is one of the
biggest challenges facing financial institutions in the 21st Century.
Technology has made it easier for criminals, either independently
or in organized groups, to create increasingly realistic counterfeit
and fictitious checks as well as false identification that can be
used to defraud financial institutions. Bankers, tellers, and operations
personnel should be ever-vigilant to protect their institution from
check fraud. As always, the first line of defense is the teller.
One way to concentrate on the prevention of check fraud is to include
a separate section on the subject in teller manuals. This section
might emphasize typical check fraud schemes and warning signs, which
include:
* A check that does not have a MICR line at the bottom.
* A routing code in the MICR line that does not match the address
of the drawee financial institution.
* MICR ink that looks shiny or that feels raised. Magnetic ink
is dull and legitimate printing produces characters that are flat
on the paper.
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* A check on
which the name and address of the drawee financial institution is
typed rather than printed, or that has spelling errors.
* A check that does not have a printed drawer name and address.
* A personal check that has no perforated edges.
* A check on which information shows indications of having been altered,
eradicated, or erased.
* A check drawn on a new account that has no (or a low) sequence
number or a high dollar number.
* A signature that is irregular-looking or shaky, or shows gaps in
odd spots.
* A check printed on poor-quality paper that feels slippery.
* Check colors that smear when rubbed with a moist finger (indicates
they were made on a color copier).
* Checks payable to a corporation that are presented for cashing
by an individual.
* Corporate or government checks which show numbers that do not match
in print style or otherwise suggest that the amount may have been
increased.
* Checks presented at busy times by belligerent or distracting customers
who typ to bypass procedures.
* Checks that have dollar amounts in numbers and in words that do
not match.
* Items marked “void” or “non-negotiable”
that are presented for cash or deposit.
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