The Washington herald., 1921-01-12
LOSS BY CHECK
FORGERY HEAVY,
STATISTICS SHOW
Big Field for Policies
'- Among Bankers and
Check Users.
By II. G. MEYER.

By II. C. MEYER.
- Astounding facts and figures re-
Iating to the activities of check
-swindlers was brought to the at
tentioa OF business men throughout
the country recently by Edward H.
Smith Agents who solicit this line,
therefore will not only find a null
tiru1e OF prospects among bankers
and users CT checking accounts,
but should find these men in par
ticularly receptive frame of mind.
Many of the facts brought out so
cOnYincingly by Mr.. Smith are pre-
sented here.
Losses from check forgeries and
alterations in this country amount
ed to about S17,OOO,OOO, in 1907 ac-
cOrding to statements made by VIM.
J. Burns before the convention of
the American Bankers Association.
We have the same authority that
the losses reached $23,000,000 in
1913. Since then the bankers have
considered II the better policy not
TO publish the figures. Reliable au-
thorities, however. now intimate
that such forgeries and alterations
now comprise a criminal industry
that costs the bankers and business
men Of this country an aggregate
loss Of 900 a year.
As compared with other forms of
property crime forgery and check
crimes have been for years on the
increase, in fact in amount of loss
this branch Of criminal industry is
exceeded only by swindling and en-
bezzlement. Roughly, it is expand
ing at the rate of s1,O00,OOO a year,
so that unless successfully COM
bated loss from this source may,
Before many years, reach the alarm
iEg proportion Of S1,O0o,Ooo a week.
History of SwindIIng.
From an insurance standpoint it
g we'll to TX clearly in mind and
distinguish between check forgery
and check alteration and also to re-
view briefly the history of check
swindling.
Check losses in this country be-
tween 1865 and 1890 were due
- ost entirely to forgeries. the art
= lteratiOns being later develop
It During this twenty-five year
1- ID bankers associations and de-
yes matched their wits against
intricate schemes of forgers
were organized so as to secure
f Utmost protection against de-
- on and prosecution.
Many Protecting Devices.
fhere are now in general use a
variety Of check protecting de-
vices which are very elaborate in
their construction and operation.
Just as a non-skid tire reduces the
danger Of skidding, patent window
catches, burglar alarms, and burg
lar-prOof safes reduce, in varying
degrees, the danger of loss through
burglary, in the same way check
protecting devices render alteration
more difficult, but they do not rem
der 1t impossible. They do not af-
ford absolute protection. They are
in no sense the equivalent Of or a
substitute for insurance any more
than a few patent window catches
and approved door locks are sub
stitute for a residence or store
burglary policy, or the best Of pro-
tective measures a substitute for
bank burglary.
No real business man or banker
today is satisfied solely with meas
ures which may prevent loss when
he can have insurance which posi-
lively will indemnify him for losses
that actually occur. Where the
swindlers forge the signature on a
check and the bank cashes it, the
responsibility for the resulting loss
IS pretty likely to attach TO the
bank, unless CollusiOn or careless
ness was proven on the part Of the
depositor.
However, in the case of a check
which is apparently genuine and
where the body Of the check-either
the amount line or the pAyee's
name has been 50 skillfully altered
as to defy detection and is Cashed,
the bank could not ordinarily be
charged with negligence and the
loss would be the depositor's.
Losses Fall on All.
Losses fall both upon the banks
and their depositors with sufficient
frequency to make the subject Of
check forgery and alteration insur-
ence of vital concern to both classes
of prospects inasmuch as it offers
protection against loss of payment
by the assured's bank, OF any check
where the signature of the assured,
or any person whose signature the
bank has been instructed by the
assured to recognize, has been
forged; of any check or draft is
sued or drawn by the assured on
which the name Of the payee or of
any other person, Arm. or corpora
tion. as indorser, is forged and
Of any check or draft issued or
drawn by the assured which has
been feloniously altered in any
way.
Everywhere in this country
banking concerns, business con-
Germs, and individuals can readily
realize that dependable insurance
is the only protection that affords
complete relief against the increas-
ing activity of check crooks and
that the protection afforded by
check forgery and alteration poll
cies is well worth having and can
be easily afforded.