Risk alert: Uptick in mail theft causing increases in check fraud

The latest risk alert from CUNA Mutual Group warns that mail theft and armed robberies against U.S. Postal Service carriers are “substantially” increasing. The criminals’ focus is to gain access to the master keys of the blue USPS mailboxes, ultimately in search of checks that can be altered, counterfeited or sold online, the alert states.

Mail theft complaints more than doubled from March 2020 to February 2021, according to the alert. In several cases, member-issued checks have been stolen from USPS mailboxes, as well as members’ own mailboxes, and then altered and negotiated elsewhere. Stolen checks are also being used to open fraudulent new accounts and loans using the name and address information for stolen identities.

What members can do
In an effort to reduce the chance of stolen mail, the alert states that credit unions can encourage members to:

  • pay bills online or using the credit union’s bill paying service;
  • mail checks inside the post office lobby rather than using blue mailboxes;
  • log into credit union accounts frequently to review transaction history, looking for unfamiliar transactions; and
  • report unfamiliar and unauthorized transactions immediately to the credit union.

Credit union risk mitigation
Credit unions have recourse against the depositary institutions that accept altered checks under UCC 4-208, Presentment Warranties. Credit unions can recover the loss by pursuing a breach of presentment warranty claim against the depositary institutions that accepted the altered checks.

CUNA Mutual Group’s risk alerts, in addition to additional risk-prevention resources, may be accessed in their Protection Resource Center. Log-in is required.

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