What are Cheque Scams?

Cheque scams are quite common these days as people resort to unscrupulous methods of minting money. These scams can not only affect the payer but the payee can also be perturbed by such incidents. Cheque scams mostly happen in the form of forgeries where the miscreant alters the details on the cheques issued by a person or an organisation. They usually change the name of the person the cheque is addressed to or the amount mentioned on the cheque. Cheque scams can lead to a significant  monetary loss.

You can avoid such scams by being alert while handling cheques. Losing a cheque can be dangerous as the person who finds your cheque might just decide to use it for illegal or unauthorised purposes instead of returning it to you or the bank.

There might also be cases where you received a counterfeit cheque from a payer who turned out to be a fraud. You can avoid such scenarios by carefully inspecting your cheque when you receive one. Most cheques issued in Singapore have similar details printed on it. These details can be considered as identifiers which will help you verify the authenticity of the cheques received. Besides, you must always be sure to verify the signatures on the cheque and if the payer’s and payee’s details mentioned on the cheque are correct.

What are the Common Identifiers on a Cheque That can be Verified?

You must look for the following identifiers to verify the authenticity of cheques issued in Singapore:

Look for the Bank Logo

Cheques usually have the logo of the bank where the chequing account is held. This is usually printed on the front side of the cheque. If you are unable to find the printed logo, your cheque might be a counterfeit one. In case the logo appears faded or less visible, it might be a case of the logo being copied from another source. You might check with your bank further to ascertain if your cheque is a fake one.

While verifying the authenticity of the bank logo printed on your cheque, also look for an address. This address usually corresponds to the bank branch where your cheque book was issued. If you fail to find this address, it is a reason for concern. You can verify this address by matching it against the address of the branch indicated directly on the bank’s website. The address printed on the cheque must completely match with the original address you find on the website. There musn’t be a single missing detail. In case you find any discrepancy, it might be an indication of counterfeit cheques.

Verify the Cheque Number

You will find a cheque number on each and every cheque issued. This number is usually printed on the front side of the cheque that’s been issued to you. This number will differ in the case of each cheque issued. In case you find this number missing, this could be a fake cheque. In this case, you can get in touch with the payer or the bank with which the chequing account is held to re-verify or raise a flag on the counterfeit cheque.

In case you do find the cheque number printed, you should look for the MICR number (Magnetic Ink Character Recognition). This number is usually printed towards the bottom part of your cheque. In case you are unable to find this number on your cheque, you could be holding on a fake cheque. The cheque issuing bank prints the MICR number on the cheque and it contains all relevant numbers pertaining to the cheque you hold. The string of numbers in the MICR of your cheque usually indicates details such as account number and the cheque number. If the cheque number printed on your cheque doesn’t match the digits printed on the far right of the MICR number, your cheque could likely be a counterfeit one. You must ideally get in touch with your bank or the payer if you spot any such discrepancy.

Verify the Signature of the Payer

The signature is one of the most important elements on a cheque that’s been issued to you. This signature also helps in verifying if the cheque is legitimate or if it has been forged. Banks usually clear the cheques that you have deposited primarily based on the signature on the issued cheque. If you find any gap, inconsistency, irregular pen strokes, or any digital appearance in the signature, you might well be apprehensive about a case of forgery. You must contact the bank in this scenario to find out if the cheque was forged or if someone unlawfully scanned it from another source.

Besides, there might be other instances where individuals make up a stamp to sign cheques. It might look printed or irregular if you take a close look. If you spot such irregularities, bring it up with the bank, payer, or other paying organisation(s).

Verify the Payee Details or Amount Payable on the Cheque

Cheques are usually addressed to the payee. All cheques have a blank space on top of the cheque where the name of the payee is to be filled. The name of the payee must be filled completely so that banks can easily verify the cheque deposited. The payer must ensure making no mistake while filling out the name as any discrepancy or error made while filling this part could render the cheque useless.

In case, there’s a discrepancy noticed by the bank when you deposit your cheque, in terms of the payee details filled, you must ideally take it up with your payer or the paying organisation. There are cases where organisations scam individuals by sending them cheques with wrong details so that these cheques can’t be used by the payee. In these cases, the counterfeiting organisation(s) usually disappear after scanning individual(s).

Additionally, there are two other blank spaces on a cheque for filling the amount to be paid. You have to enter the amount in words in one of the blank spaces followed by the word “only”. This section is usually under the part where you fill the payee details. The other blank space is in the form of a box where the payer enters the amount payable in digits. You must ensure verifying the amount stated in both those spaces to avoid any scenario involving irregularities. Besides, the amount stated both in words and in digits must always match. In case they don’t match, you have a reason to raise an alarm.

Case Studies on Cheque-Related Scams

The following case studies pertaining to scams on cheque will provide you with instances how you can easily fall prey to these unscrupulous activities:

Case Study 1

It’s often difficult for boards and audit committees of large organisations to counter the risks of fraud, bribery, and cases of forgery, mostly occurring as a result of gaps in absorbing the large volumes of compliance information. Miscreants often see this as an opportunity for minting money in an unlawful manner.

The case of Mr. Tan Yong Hai is such an instance. He was employed by Sodexo and was working as a Facility Executive at the firm. He was responsible for overseeing building maintenance and estate management for Sodexo’s clients. Mr. Tan was involved in forging cheques on behalf of those clients as well as forging lease agreements. He was charged with forging nine lease agreements under a project involving Invensys Process Systems, a client of Sodexo that pays rent for foreign engineers who worked in Singapore.

Following the initial investigation from Invensys, Mr. Tan stole cheques on which he later forged the signatures. He minted $990,000 from forging cheques. He withdrew the money and skipped to Thailand. Later, he returned to Singapore with the intention of defrauding another company for $3.6 million. But, a bank realised Mr. Tan’s plan and alerted the company. The organisation reported it to the police and he was apprehended. He was sentenced to a jail time of nine years and three months after being charged with six forgery cases and other offences.

Case Study 2

Cheque forgery doesn’t only happen in case of a large organisation, it can also happen within families where members unlawfully forge signatures on stolen cheques and deposit it to the bank without the account holder really taking note of the fraud until it’s too late.

The case of Kelvin Ang Soon Lim is one such instance. In 2013, he forged cheques stolen from his wife’s OCBC account. Investigations confirmed that he brought two OCBC cheques worth $380,000 and $260,000. A total amount of $640,000 was deposited from the two cheques into his POSB account. Mr. Kelvin observed his wife sign her telco bills and tried to forge the same signature on the stolen cheques. Investigations confirmed that all the money deposited into his OCBC account was stolen from his wife with through forgery.

Mr. Kelvin was later caught and he admitted to stealing, forging, and using S$380,000 from the stolen funds to repay a loan shark. The man was jailed for four years following the incident of forgery. The maximum penalty for such forgery-related offences committed in Singapore can go up to 15 years along with a fine levied against each charge.

Case Study 3

Another similar case involved a son stealing money from his father through forged cheques. The culprit, Eugene Goh took his father’s cheque and forged his signature on it. Mr. Eugene put down his own name and stated a payable amount of S$5,000 on the cheque. He also wrote the account number for his bank, his name, and the contact number on the reverse side of the cheque that was forged. He used a similar approach to forge another cheque the following month. He received another S$5,000 in his bank account through the second forged cheque.

Mr. Eugene had stolen seven cheques out of his father’s cheque book in total, where each transaction ranged somewhere between S$3,000 and S$5,000. When he realised the unauthorised transactions made in his bank account, he decided to lodge a complaint with the police, despite his suspicions about his son stealing his cheque book.

In a separate incident, Eugene had stolen some money from the cash register of the place he worked at for which he was apprehended. Once caught, the man admitted to two accounts of cheque forgery. The court decided on a jail time of 10 months for Eugene on account of stealing a total of S$27,000 from his father through forged cheques as well as for committing a theft.

Case Study 4

Sometimes situations might turn out so dire that you might want to resort to unscrupulous activities to address the need for money. Some people forge cheques and deposit into another’s account unlawfully for money. One such instance is the story of Mr. Goh Jun Jie. Mr. Goh worked at Shangri-La’s Rasa Sentosa Resort and Spa. The man committed a cheque forgery amounting to S$8,900 at the place he was working. He stated that he had committed this offence out of dire financial need. His wife was pregnant at that time and he got into a quarrel with his wife regarding the need for money. The money obtained through forgery was used to buy baby supplies such as a pram and a breast pump, among others.

Mr. Goh had been working at the place as an Account Executive for around five months in 2014. His job role included preparing cheques for the resort’s suppliers. During the course of his job, he would often use sticky tape and remove words printed by mistake on these cheques, to eventually print the correct words. In his time of committing the forgery, he used the same approach and changed the payee field on the cheque and put his wife’s name. The altered cheque was deposited into the bank account of his wife. His superior noticed a discrepancy and took the matter to the police. Mr. Goh was placed under investigation for the offence of forgery following the police complaint.

He committed another offence later by lying to the Immigration and Checkpoints Authority (ICA) about losing his passport. He did this in order to obtain a new one as his earlier passport was confiscated by the police to disallow him from traveling. He did obtain a replacement passport but was later apprehended by ICA officers at Changi Airport when he tried to flee Singapore. The District Judge sentenced Mr. Goh to 18 months of prison time.

How to Avoid Cheque Scams?

You must always keep the following aspects in mind while verifying a cheque:

  • You must keep an open eye for spelling or typing errors on the cheque for segments that have been printed. If you notice any discrepancy, you might ascertain that the cheque could be a counterfeit one.
  • You must also match the amount mentioned in the cheque with the sum that has been spelled out. This will not only help you avoid any scams pertaining to your cheque but it will also help you avoid any scenario where your cheque could bounce back.
  • You need to have an eye for details. Often counterfeit cheques have details erased or added, which might not be easily visible. In case you notice any irregularities of this nature, you might want to raise an alarm with the bank, or the paying individual or organisation(s).

Simply put, you should be careful while handling cheques. You shouldn’t lose cheque(s) that has/have been issued to you. The case studies mentioned above give you a picture of how cheque scams take place, within and outside family. Forgery is one common type of scam involving different techniques of adding or erasing details on these cheques. You must ideally report any such instances right away to the bank and/or the police. Banks are usually helpful when it comes to helping clients deal with instances involving cheque scams.

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