CHEQUE FRAUDS.

Hokitika Guardian, 31 July 1924, Page 4

CHEQUE FRAUDS.

CAKEI.ESSXESS HELPS FORGERS

AUCKLAND Julv 27

The dis/ju/isiou in the il.egisla.tive Council on the subject of the liability of banks "lieu cheques have ibeen fraudulently altered (says tlio “Star”) has created some interest in financial and commercial circles. Busintts l-eople report that they are continually receiving cheques so carelessly drawn as practically to invite fraud. In America frautliileiitiy-iilteied cheques have ci.tuiUn! tlio lots of milJioiis of <lolI:»rs an:l during the last few months a. new system has been devised which prevents the wholesale use of ('lemicnls, the favorite method of treating elieques. A material lias been discovered which prints in the hotly of the document a pattern which entirely disappears when any chemical is applied to it, and the l'otger linde himself in possession of a document in which the original pattern is replaced by hundreds of copies of the line. “Payment stopped.”

In New Zealand alterations of this nature are very rare, loss usually occurring oly in easily altered amounts. It is the simplest tiling in the world t> alter "eight” to “eighty”, if the forger has reason to believe that the larger amount will be ] aid on presentation of the cheque. This actually happened in Auckland a Ie" years ago. The danger is not met by the suggestion rf (he Hon. A. S. Malcolm, AI.K.C'., that space he left on the form lor it to he stated that the cheque i; r.ot above a certain amount, in the ca.se cited "nine” in this space imiiil easily have been altered to “ninety.” for me-t of the danger arises through i arele-'ly sprawling uniting along the loi'm, instead of joining all the words

together. A lost of the large houses take

precaution of rsing u stamping machine, which not only piints the amount. hut actually cuts the letters into the paper, ami leaves no spaces lor adding anything. 'These machines however, are not in common use, and therefore give no protection to the general public. T here is also the ilifii(uli.v that the eheqi os gel mutilated. One merchant, yesterday produced a Government cheque, stamped in this way right ai loss the middle, "here it had i.een folded many times during the weeks ill which it had passed from one owner to auollier in ireoidance with the practice of treating Government cheques as banknotes. Th amount was entirely obliterated and anyone (oiild easily have altered the amount, in figures at. the bottom.