Checks repeatedly top the list of payment methods most susceptible to fraud. Federal Reserve Financial Services (FRFS) offers tools to help financial institutions mitigate check fraud loss.
Each year, the Association for Financial Professionals (AFP®) releases its AFP Payments Fraud and Control Survey Report Key Highlights (Off-site), which examines the nature and extent of fraud attacks on business-to-business (B2B) transactions and the payment methods impacted. The report is based on a survey of corporate practitioners from organizations of varying sizes and industries.
The 2025 survey identified checks as the payment method most subject to fraud, with 63% of respondents experiencing attempted or actual check fraud in 2024. Despite the risk, checks are still a favored payment method among the organizations surveyed — 91% reported using checks and more than 75% said they had no immediate plans to stop using them.
The survey concludes that most organizations are not yet deterred from using checks even though they are aware of the risks. Checks — and check fraud — are a reality for now, and financial institutions must respond by investing in multi-layered technologies that can help mitigate fraud risk. Employing a diverse set of defenses allows financial institutions the greatest opportunity to combat continually evolving fraudsters.
Discover FRFS fraud risk management tools
Check fraud continues to be a significant threat. FRFS offers several services to help financial institutions quickly detect potentially fraudulent transactions.
The FedPayments® Reporter Service for Check Services helps financial institutions and their corporate customers fight check fraud through advanced reporting, including the option to receive front and back images of items being presented in a PDF report.
- Benefits for financial institutions: The DFI-level Check Advanced Notice Payor Report provides a financial institution’s staff with more time to review checks for potential alterations and suspicious endorsements via secure email as early as the afternoon of the banking day before presentment.
- Benefits for financial institutions’ corporate customers: The Corporate Payor Report allows corporate customers early access to review check details on the morning of presentment via secure email. This early notice gives financial institutions and their business customers more time to review checks for potential alterations and suspicious endorsements to help ensure that potentially fraudulent items are returned in a timely manner.
The FedDetect® Duplicate Notification for Check Services helps financial institutions counter check fraud by providing notice and images of potential duplicate checks across multiple payment channels, both internally and across all other banks of first deposit. Notices are sent via encrypted email and may be used to supplement a financial institution’s research, allowing it to take appropriate action such as extending funds availability holds to reduce risk of loss of funds.
Contact your relationship manager to learn more about how FRFS Check Services could help your financial institution protect itself from check fraud.
"AFP" is a registered trademark of the Association for Financial Professionals.
