Question: This is one of those questions that has been nagging at me for a long time, so I might as well get it off my chest. When you're in a supermarket (and usually in a hurry), the guy ahead of you almost always pays with a check. Then everything comes to a screeching halt until the manager or assistant manager is called over by the check-out clerk to look the check over.
My question is: What in the world are these people looking for when they inspect these checks? Also, you almost never see them not OK a check, so what's the criteria?--T.W.
Answer: There are cynics in the law-enforcement business who would tell you that not more than one in 10 of those studious-looking store managers, poring over a customer's check, has the foggiest idea of what he is looking for.
For instance: A depressing number of those promotional "checks" that merchants send out in bulk--good for the discount amount indicated only if you buy the item being touted--are presented for payment and are cashed. Another example of keen observation: jotting down the check writer's driver's license number on the back of the check but, in the process, failing to note from the picture that the license was issued to a woman and that the check writer is indisputably a man.
All of which is doubly frustrating, according to paper-fraud expert Robert Cekosky, because roughly two-thirds of all bad checks written--amounting to about $4 billion a year and accounting for an estimated 15 cents out of every consumer dollar spent--are passed by "either flakes or amateurs," he says. These are people who aren't really all that good at their craft, are relatively easily spotted and who panic quickly.
Flakes are roughly defined as the chronically irresponsible who bounce around from one closed bank account to another (because of their not-sufficient-funds record), and the bulk of the amateurs are either on drugs or alcohol and operate in a continual haze, Cekosky adds.
And, while retailers are the prime targets, of course, anyone who ever accepts a check in payment for anything should know some of the basic facts of life about this form of paper currency, because the problem is mushrooming.
As recently as 1971 one out of every 114 checks written was bad; by '75 it was one in 89, and by '79 it was up to (or should it be down to?) one in 80. And, Cekosky emphasizes, nine out of 10 writers of bad checks are never prosecuted.
All of which puts grocers, in particular, on the horns of a real dilemma because about 85% to 90% of all food purchases are made by check. If you refuse to accept checks, you're out of business.
With a background in the credit-collection industry, Cekosky became fascinated with the mechanics of paper fraud--the basis of a high percentage of his collection efforts--but found very little helpful literature on the subject. It led him on a four-year research project and the recent publication of his "Check and Credit Card Fraud Prevention Manual," a 300-page, loose-leaf, illustrated work exploring all of the tricks of the "paperhanger's" art (available from the author, $65, P.O. Box 26118, Los Angeles 90026).
What to Check
What should those store managers be looking for when they are called in to OK a check? On this score, Cekosky borrows from a guideline familiarly known as the BAD PIES checklist, which was introduced several years ago by L. J. Riker, formerly a lieutenant in the Los Angeles Police Department's bunco/forgery division.
Sorting out the acronym, here are the important points:
B--the bank involved. Is it really a bank check--one with a name and address prominently printed on it--and with a string of magnetic coding at the bottom? If it doesn't have these features on it, there's a good chance that it's a retailer's promotional discount coupon or a counter check--which any transient can stroll in and remove from a bank's customer-service desk. Is it a local bank? It's almost impossible, Cekosky notes, to collect on a bad out-of-town check.
A--the amount of the check. Is the numerical amount exactly the same as the written amount? Is there any indication that either numbers or words have been squeezed together to "kite" an $82 check into $182? A discouraging number of checks, illustrated by the author in his manual, are passed successfully although extremely crude in execution: The dollar amount, $15 is simply kited to $115 by adding a 1 and with a clumsy addition of "One" to the "Fifteen" on the written line.
D--the date. Some pretty ancient and worthless checks squeeze through simply because the clerk didn't require the writing of it in his presence and the manager missed the age discrepancy. The older it is, the harder is it to collect.