Check Washing & Alteration: Understanding and Preventing a Growing Financial Threat

Overview of the Scam

Check washing and alteration is a form of financial fraud in which criminals steal paper checks—most often from the mail—and chemically erase the ink, allowing them to rewrite the payee name and dollar amount. Criminals commonly use household solvents to remove the original information from the check before rewriting significantly higher amounts or redirecting funds to fraudulent accounts.

 
The U.S. Postal Inspection Service (USPIS) reports that criminals steal checks from mailboxes or postal facilities and use chemical “washing” or digital alteration methods to manipulate them. USPIS estimates over $1 billion in counterfeit checks and money orders are recovered annually, underscoring the widespread nature of the threat.
 
In recent years, incidents have risen sharply. The FBI’s Internet Crime Complaint Center (IC3) notes that check fraud—much of it tied to mail theft and check washing—nearly doubled between 2021 and 2023. Criminals are increasingly selling stolen checks online and using “money mules” to deposit altered checks before banks can detect the fraud.
 

Impact on Customers

The consequences for customers can be severe, both financially and personally. 

1. Major Financial Losses

Victims often lose thousands of dollars when washed checks are rewritten for larger amounts. Documented cases include a $656 check altered to $9,000, and even an IRS payment of $310,000 that was chemically washed and stolen. Depending on the circumstances, Banks may be able to reimburse victims, many customers experience delays during investigations, leaving them without access to funds.

2. Compromised Personal and Banking Information

When criminals obtain a check, they gain access to account numbers, signatures, names, and sometimes addresses. IC3 reports that stolen checks can lead not only to monetary theft but also identity-related fraud, where exposed personal information is later sold or reused.

3. Additional Administrative and Credit Issues

Victims may face:

  • Late or missed bill payments
  • Stop‑payment fees
  • Account closures or frozen accounts
  • Temporary drops in credit score due to delayed payments

How Customers Can Protect Themselves

 
Experts and postal authorities recommend several effective steps to reduce risk:
 

1. Use Gel-Based Pens

 
Gel ink binds deeply into paper fibers, making it significantly harder for criminals to remove using chemical solvents. 
 

2. Avoid Mailing Checks When Possible

 
Mail theft is a major driver of check washing. USPIS recommends limiting the use of mail for payments. It is recommended to utilize digital banking tools by using ACH or automatic payments for routine bills versus writing out checks. 
 

3. Practice Safe Mail Habits

  • Deposit mail before the final daily pickup
  • Never leave outgoing checks in a personal mailbox overnight
  • Have the post office hold mail during vacations

4. Monitor Accounts Regularly

Frequent account reviews help customers identify unauthorized withdrawals early so they can notify their bank before more funds are lost.

5. Report Suspicious Activity Immediately

 
If you suspect theft or fraud, contact:
  • Minnesota National Bank
  • Local law enforcement
  • The U.S. Postal Inspection Service

How Minnesota National Bank Can Help

Minnesota National Bank plays a critical role in detecting and preventing check washing through technology, customer education, and fraud‑detection protocols.

1. Implement Payee‑Matching (Positive Pay) Technology

This system compares details on presented checks against the issuer’s original record, catching mismatched payees or altered amounts. Minnesota National Bank relies on this control to prevent altered checks from clearing.

2. Maintain Strong Relationships With Law Enforcement

 

FinCEN and USPIS encourage banks to submit timely reports of suspicious activity and to collaborate on emerging patterns. During a six‑month period in 2023, FinCEN received 15,417 reports of mail‑related check fraud totaling over $688 million, demonstrating the importance of coordinated reporting.

3. Educate Customers

 
Minnesota National Bank protects our customer base by providing:
  • Fraud awareness campaigns
  • Guidance on secure payment methods
  • Clear instructions for reporting suspicious transactions

4. Provide Alternative Digital Payment Options

 
Minnesota National Bank offers digital banking tools that allow for automatic payments for routine bills versus writing out checks for payments. A Personal Banker is able to assist with setting up online banking accounts and payments. 

Conclusion

 

Check washing and alteration remain among the fastest‑growing forms of financial fraud in the United States. Criminals exploit weaknesses in mail security and check‑processing systems to steal funds quickly and anonymously. With losses exceeding $1 billion annually and incidents continuing to increase, customers and banks must work collectively to stay ahead of this threat.

Understanding how the scam works—and taking proactive measures—can significantly reduce risk. Through secure behavior, vigilant monitoring, and strong bank‑supported protections, both individuals and Minnesota National Bank can better safeguard their finances against check washing fraud.