Bad checks
A check is not cash, but an “IOU” or promise that cash will be paid upon presentation of the check at the writer’s bank. A check is bad when it cannot be redeemed for cash. Establish a firm check-cashing policy and post it where it can be easily read by customers and referred to by employees. This policy should specify your acceptance criteria concerning the following information.
• Amount of check – limit the amount a check may be written or limit it to the amount of purchase; require management approval for any check written in excess of a set dollar amount.
• Two-party checks have a higher incidence of unreliability and can be more difficult to collect.
• Local versus out-of-state checks – local check writers are easier to contact for collection. Washington courts cannot prosecute out-of-state check writers unless they can be contacted within our state.
• Identification – the primary identification for collection purposes is a driver’s license or special identification card issued by the state.
• Other limits – Specify any other limits so they will be clearly understood by customers and employees.
• Returned check fee – collect a returned check processing fee of up to $20. All checks should accurately reflect the name, address (mailing and physical), driver’s license or valid identification number and home and work phone numbers of the check writer. If this information is not accurately recorded on the check, the employee should write it clearly on the check.
The following items should also be considered when accepting a check:
• make sure name, picture (or description) and signature match the check writer’s identification;
• written and numerical amounts agree;
• correct date (not postdated);
• any erasures, alterations, or abnormalities;
• low check number (new accounts can be less reliable) and
• local versus out-of-state (use extra caution when accepting an out-of-state check). The writer should be a Washington resident in case he/she needs to be contacted for collection.
Counterfeit bills – the three basic types of counterfeit bills are:
• low denomination bills altered to appear higher (corners of large bills glued to small bills);
• photocopies of authentic bills , and
• printed counterfeit bills.
Inspect all bills, especially larger ones, for appropriate portraits.
• Compare them to known bills of the same denomination.
• Look for differences, not similarities.
• Counterfeits will be less detailed and have a flat appearance, appearing washed out. Authentic bills are always printed on safety paper with fine red and blue hair-like fibers imbedded in them. Do not be fooled by colored lines printed on paper.
Credit card fraud
Many people use credit cards as their preferred method of payment. Unfortunately, the use of stolen or forged credit cards is also a popular tactic among crooks. You and your employees should follow the strict acceptance procedures set by each credit card company. Keep the following points in mind to further reduce your chances for loss.
• Keep a copy of credit card agreements on file so they can be easily retrieved.
• Post a procedural guide for credit card transactions next to the register.
• Install a telephone at the register; post authorization numbers nearby.
• If uneasy about a transaction, call the credit card company and ask their security personnel for advice before completing the transaction.
• Do not return the card until they instruct you to do so.
• Have employees initial credit transactions in the event of a discrepancy.
• Protect yourself and your customers by keeping credit card transactions confidential. Give charge slip carbons directly to the customer or have them destroyed immediately by personnel. Thieves can obtain names and numbers from the trash and use them for fraudulent mail or phone order scams.
Charge-backs can occur if a cardholder disputes any charges, especially in mail or phone orders.
