Fed expands fraud detection program to commercial checks

Federal Reserve Financial Services (FRFS) announced the expansion of FedDetect Duplicate Notification for Check Services to include commercial checks alongside its existing Treasury check notification service. Financial institutions can now see deposit information and images of potential duplicate items for commercial checks, supplementing their existing check fraud mitigation tools.

According to a 2024 survey (Off-site) of treasury practitioner members and prospects by the Association for Financial Professionals, 65% reported checks as the payment method most susceptible to fraud. Despite this, among those organizations using checks, 70% report no immediate plans to discontinue their use.

“Commercial checks remain a critically important form of payment, but they’re also vulnerable to fraud,” said Shonda Clay, FRFS executive vice president and chief of product and relationship management. “With the expansion of our FedDetect service, we are providing financial institutions of all sizes another powerful tool in their risk mitigation toolkit. Even better, we are now offering this service at no cost as part of our commitment to supporting depository institutions in the collective, industry-wide mission to combat fraud.”