COLUMBUS, Ga. (WRBL) – Across the nation, business owners, consumers and family members are being hit by a mail theft and check fraud epidemic that is costing them hundreds to thousands of dollars at a time.
One local business owner lost $100,000 after dropping a check off in a United States Postal Office drop box. Columbus police say he is just one of hundreds to fall victim to a rampant uptick in check fraud and identity theft stemming from the blue boxes.
So far this year the Financial Crimes Unit has investigated 300 check fraud cases, and they say most of them can be traced back to the blue USPS drop boxes.
What is Happening
Sgt. Jane Edendfield with Columbus Police Department’s Financial Crimes Unit says the suspects have been damaging the blue mailboxes to get the mail out from the inside, and in areas outside of Columbus they have even forcibly robbed postal carriers of their master keys to steal the mail. She says she has worked with precincts across the country solving these crimes.
“This is not a Columbus problem. This is not a Georgia problem. This is a nationwide problem. So, there are lots of cases that we get that originate in North Carolina or, you know, Arizona or Montana or wherever. And so, it’s just a nationwide problem. So, we’re having to work with agencies all over the country and they’re having to work with us,” Sgt. Edenfield said.
Once the suspects get the mail out, they are finding the checks, then taking the account routing number off the bottom to create an entirely new counterfeit check for a different amount.
This scheme requires several people. Someone who steals the mail, another who solicits people on social media to give up their bank account information, another who forges fraudulent checks, and someone else who is depositing these checks into the bank.
“It is absolutely not a one-man job. It is a whole check fraud ring. There are multiple in Columbus. We’ve got a couple that are floating between here in Atlanta. It’s a nationwide thing. They solicit people, they get on social media, solicit people to willingly give up their bank account information. So not only is it people here in Columbus, the suspect might be here in Columbus, but then you’ve got people in other states that are using social media to willingly give their bank account information. So, the checks are being deposited all over the country. It is just rampant,” Edenfield explained. She also says despite what people may believe the criminals carrying out these crimes are violent.
“People typically think that financial crimes and fraud, they are people that sit behind a desk with a computer. White collar crime as they call it. I’ll tell you, the guys we’re dealing with, with these kinds of crimes, they’re the same guys out here shooting and killing people,” she said.
Marketing President of Colony Bank, Mike Welch, says he has noticed a trend when these suspects are depositing the checks; they’ve gone virtual.
“Frauders won’t cash the check at the bank that it’s drawn on. They’ll go to another bank where they’ve opened up a checking account with a fraud I.D., a fake I.D., and then they’ll try to cash it or deposit it there. These people aren’t cashing the checks inside the bank, they’re remote, depositing the check so that their face is not seen on camera,” he shared.
Welch has also noticed these crimes have ramped up over the last four to five months. He says there have been 25 to 30 accounts have been frauded at his bank ranging from $1,000 to $40,000.
“90% of them are using blue mailboxes, or they think that’s where it originated from,” Welch said. “There’s very few that say that ‘the mail was picked up in my office’ or ‘I took the mail to the post office myself,’” he added.
USPS says these crimes typically happen on Sundays, holidays, or after the last scheduled collection time on weekdays.
The highest amount the Financial Crimes Unit has seen attempted to be cashed was worth $500,000. Anyone can be a victim. Sgt. Edenfield says these crimes originated in business mailboxes; however, they have graduated to the blue drop boxes.
“Let’s say you or I write a check for $200 to pay our Georgia Power bill and then put it in a metal blue box. They take that account routing number off the bottom. They use that check writing software and then counterfeit a whole new check and make it whatever amount they want to make it for,” Sgt. Edenfield said.
“It’s both consumers, just a regular family member that’s having it done, as well as businesses that are having it done to them. So, it’s important, again, to make sure you’re looking at your checking account and making sure you’re looking at copies of checks so that you can validate where the amount that you wrote it for is the same amount. And the payee is the correct payee that you wrote that check to,” Welch explained.
How to Stay Vigilant; How to avoid being frauded
The Financial Crimes Unit tells everyone who falls victim to these crimes it may be a lengthy process to get it all resolved; despite this they ask everyone to report these instances to the police department.
Once an account has been compromised, it important to freeze that account and open a new one because the fraud will continue as long as that account remains open. It is also important to report any suspicious or fraudulent activity directly to their bank.
“They just need to notify their bank that they have fraud on their account and the bank will handle it appropriately, credit their account, and then work it backwards to try to get their money from the bank that cashed that check,” Welch informed.
Account holders and businesses can also be proactive in protecting their account.
“There are things that people can do. I’ve been talking to these businesses as we work these cases. A lot of businesses are moving towards paying vendors with ACH payments, direct deposits. I understand there are smaller businesses that just have to write checks. So, I’ve advised having the vendors come to them, hand them the check or go to that vendor, give them the check, walk your checks into the post office itself, hand it to your mail carrier himself or herself,” Sgt. Edenfield advised.
This advice is similar to average consumers and citizens, Welch provided tips for check users to keep from falling victim.
“It’s so important that they make sure they’re looking and they’re checking accounts frequently, whether it be online or coming to the bank and saying, ‘Hey, would you pull up this check? I want to make sure that it was written to the right person for the right amount,'” he said. “Walk into the bank, walk into wherever you’re making a payment to, if that’s possible. Either making payments online if you can or taking a mail directly to the post office and either handing it to the postal clerk or dropping it in the slot at the post office itself.”
Welch says most banks also participate in Positive Pay, a cash management service that is specifically designed to detect check fraud and fraudulent ACH transactions. He says the customer has the capability to log into the software daily, input who the payee was to the check, the amount it was written for, and what the check number was. These three identifiers are then used by the bank to verify a check before cashing it to make sure everything is matching up correctly. While this program was designed for businesses, consumers can also take advantage of this program.
What is Card-Cracking; How to avoid becoming an accomplice
Sgt. Edenfield warns people to stay safe on the internet. Suspects are soliciting people on social media for their bank account information, and several have been traced back here to Columbus.
“I’ve got a wall of 40, 50 repeat suspects in front of my office. But if you took every one of those account holders that willingly give up their account information, you know, for a small monetary kickback. I mean, we’re talking hundreds just here in Columbus,” she added.
Why do suspects solicit people on the internet? They need an account to cash the fraudulent checks into.
“These suspects are promising those people that are giving up their information that there’s nothing illegal about it, they’ll get a monetary kickback, and they won’t get in trouble. I can tell you; it is very illegal,” she said.
She says if the Financial Crimes Unit can prove an individual willingly gave up their bank account information, they will take legal action against the account holder.
“We’re also putting the account holders in jail as well because they’re willingly deceiving the banks,” Sgt. Edenfield said. “I just, I want to caution people, you know, if this sounds too good to be true, it’s too good to be true. They promise you a couple thousand dollars or a couple hundred dollars. Trust me, you’re going to get the short end of the stick. If it comes through my desk, my office, my other detectives, you can get jail time just for giving up your bank account information.”
In addition to this, the bank seeks out the account holders. If, or when, the fraudulent check bounces, banks look towards the account holder to repay that money.
“You’re going to owe the bank the money. Once those checks bounce, you’re going to owe the money. So, it could be $10,000, $20,000, $30,000, $40,000. If you have anybody else on your bank account with you, a spouse, a parent, a child, if you’re the child, those people that are also in your bank account are also going to be held responsible,” Sgt. Edenfield informed.
In Columbus, she has seen people solicit information primarily on Snapchat, Facebook, and Instagram. Given the suspects reach on social media, the Financial Crimes Unit has seen teenagers as young as 15, 16, or 17-years-old give up their bank account information. She warns social media users to be cautious of anyone messaging them with money bags in their account descriptions or usernames.
Both Welch and Sgt. Edenfield urge residents to check their bank accounts daily, verify the status of the check with the payee and their bank, utilize online payment options, and when possible, take checks into the post offices directly. Anyone who suspects fraud in their account should get in contact with their bank and file a report with the Columbus Police Department.