The
best way to reduce your losses is to avoid taking bad checks from
the start. The following tips are suggestions to help you establish
good procedures for accepting checks.
Institute
a check acceptance policy.
A clearly posted check
acceptance policy for your employees and customers can go a long
way toward reducing your losses. Policies should state which types
of checks can and cannot be accepted and include the consequences
to bad check writers.
Confirm
the identity of the check writer.
All I.D. can be forged.
The most reliable form of I.D. is that which contains a photo
and a physical description. Take the I.D. in hand and write the
I.D. number, birth date, address and other descriptive data on
the front of the check. Ask questions. If the I.D. does not belong
to the person writing the check, they may be thrown off guard.
Whenever
possible avoid accepting checks written on a new account.
Approximately 85% of all
bad checks are written on accounts only a few months old and bear
check numbers between 101 and 150. Use caution. Do not accept
counter drafts.
The
signature should be legible and signed in the presence of the
individual accepting the check.
Do NOT accept previously
signed checks. For a company check, it is vital that the signature
is legible. If not, print the individual's name on the front of
the check.
The
complete address should be imprinted on the check.
Require a street address,
in addition to a P.O. Box number. Obtain a phone number as well.
Accept
checks only written with today's date.
Pre- or post-dated checks
are not accepted in the Bad Check Restitution Program and cannot
typically be criminally prosecuted. This restricts any recourse
you may have against the check writer if your own collection attempts
fail.
Make
sure written amounts and numbers correspond.
Banks will not honor checks with discrepancies
between written amounts and numbers.
Avoid
accepting checks drawn on an out-of-state bank.
REMEMBER,
you are not required to accept a check from anyone.
If you feel uncomfortable or suspicious, trust your intuition!
Ask for another form of payment.
