Adams and Reese Partner Scott Jones authored the second most read article in the ABA Banking Journal in 2023 as the publication reported on the top banking stories of the year.
Jones’ article “Back with a Vengeance: The Challenges of Check Fraud” discusses how check fraud continues to soar and provides an overview of the competing obligations of financial institutions involved in the process of depositing and paying checks. The American Banking Association launched a free Check Fraud Claims Directory to help banks manage the behind-the-scenes process.
The Financial Crime Enforcement Network reports that in 2021, financial institutions filed more than 350,000 Suspicious Activity Reports of potential check fraud, a 23 percent increase over 2020. This upward trend continued into 2022, when the number of SARs related to check fraud reached over 680,000, nearly double the previous year’s filings. This compares to 96,786 suspicious activity check fraud cases reported in 2014.
“Criminals are becoming more sophisticated and organized across technology and messaging apps, where they can send encrypted messages and conceal their identities through anonymous and untraceable usernames,” writes Jones. “The increase in cases is creating many check fraud processing challenges such as backlogs in check warranty claims, availability of funds and the average check value doubling over the last decade.”
At Adams and Reese, Jones advises financial institutions throughout the United States, and represents clients primarily in the financial services and construction industries. He works with financial institutions on payment systems, payments fraud and bank operations, including treasury management services, wire transfers, ACH transactions, Internet banking, mobile banking, checks and emerging payment systems.
Jones serves as Partner in Charge of the Adams and Reese Jackson office.