Checking Your Bona Fides

Back in the good old days, when checks took weeks to clear, banks verified a check by examining the check writer's signature. Some banks still do -- often using a digitized signature they have on file -- but now that most banks have thousands of depositors, this method just isn't as practical as it once was. As for vendors, they have no easy way of guessing whether a check is bouncy until it comes back on them.

The growing need for verification has given rise to a number of specialized businesses that do nothing but verify 1) That you're who you say you are; and 2) That you've got enough money in the bank to cover the check you're writing. Your check information is processed electronically and sent through the phone lines to a verifier, and they send back word on whether your check is any good or not. You've probably dealt with one or more of these companies in the past, with varying levels of frustration; some people tell stories of their checks being denied just because the verification service wanted to verify their address (hey, isn't that the verification service's job?).

Be that as it may, it's rare that a check written to a business doesn't go through the "instant" verification process. Companies like Equifax, SCAN, Telecheck, and others have made plenty of money off their clients' fears of bad checks. However, sometimes their information is wrong, and you have the right to call them on it. If your check is rejected by one of the check verification services, feel free to call and straighten them out -- on the spot, if need be.

On to A Checkless Society? Pull The Other One, Why Don't You? .. Back