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Bad check detection

Updated December 23, 2009

Your business should have a strict check and credit card approval procedure.

  • For checks, require a driver’s license as a source of identification.
  • Train your employees to "read" the check carefully and write down all the information, and verify the signature and the physical description.
  • Don’t cash two-party checks.
  • Be cautious about out-of-area checks.
  • Look at credit cards to be sure they haven’t been altered. Compare signatures on the charge slip. For added security, ask for a driver's license as extra identification.
  • Be extra wary of customers trying to rush approval, customers who distract the cashier with excessive conversation or confusion, customers who use checks with low serial numbers or checks with erasures or write-overs, or customers who buy and carry out items without really looking at them or the price, especially if that item could be pawned.
  • Watch for checks that are undated, post-dated or dated over 30 days. Accept only those checks written in ink with no erasures or written-over amounts.
  • Do not accept Social Security cards, library cards, work permits or voter registration cards as identification.
  • Decide which checks you will accept and set a limit on the amount.
  • The information from the identification cards should be copied down on the checks along with the amount of purchase and the employee’s signature.
  • Be sure questionable checks or credit card purchases require approval by a senior manager.
  • Use "hot sheets." Call to check with the credit card company or bank for larger amounts or questionable checks.

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