In the past, Wendy has made several postings about check washing fraud like this last one back in December 2024.
Check washing fraud
https://discussion.fool.com/t/check-washing-fraud/111777
I’ll start my post with this latest one for background info.
August 30, 2025
Check washing’ costs Americans over $1 billion each year, says USPIS — how to spot it and protect your money
https://finance.yahoo.com/news/check-washing-costs-americans-over-210000527.html
According to the U.S. Postal Inspection Service (USPIS), “check washing” fraud is inflicting substantial financial damage on Americans. Postal inspectors report intercepting more than $1 billion in fraudulent checks and money orders annually.
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What is “check washing”?
Check washing is a theft method where criminals steal checks, commonly from mailboxes, and use household chemicals such as nail polish remover or rubbing alcohol to erase the ink. After removing the original information, the thief changes the payee name and amount, cashes the altered check and escapes with the stolen funds.
(snip)
Criminal organizations have been identified selling stolen checks on digital platforms and recruiting individuals known as “money mules” to deposit falsified checks into fraudulent accounts, according to NASDAQ Verafin. In a contemporary evolution of this long-established fraud scheme, these stolen checks are now being traded on dark web marketplaces in exchange for cryptocurrency.
(snip)
The end of paper checks could cause problems for consumers who don’t have access to a traditional bank account and still depend on the small slips of paper to receive some of their funds, including their paycheck. About 6% of adults were “unbanked” in 2024, according to the Federal Reserve, meaning neither they nor their spouse or partner had a checking, savings, or money market account. That unbanked percentage rises to 22% for those with an income below $25,000.
Older consumers who might not be as comfortable with new technologies, or the estimated 10% of Americans who don’t even have smartphones, could also be greatly disadvantage by a further move towards electronic payment systems.
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MY RECENT INCIDENT
12/11/25, Thursday
• Late afternoon, my credit union (CU), located in Los Angeles County, called to inform me that my check payment #1940 for $250 in my family trust checking account was fraudulently altered to $3,500 by someone and processed by another credit union located in Victorville (San Bernardino County) that had the wherewithal to report this fraud to my credit union.
• My CU had me open my online checking account to confirm that check #1940 (recorded on 12/5/25) had in fact been altered and to identify what other checks remained outstanding.
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My CU also related that my checking account was closed and that a new checking account number would be sent to me immediately via a secure email message using Mimecast Services. Equally important, the secure message would also include an Affidavit of Forgery/Alteration, State of California, County of Los Angeles for me to complete showing the original check #1940 information (date, payee, drawer, drawee financial institution, original amount $250.00) versus the altered/forged check (date, payee and amount $3,500.00). The only thing unchanged was my signature.
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My CU told me to report the new checking account number to all auto pay parties and all parties that make direct deposits to my family trust checking account, e.g., Social Security checks and Veterans Affairs disability checks.
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Finally, my CU directed me to file a check washing fraud report to the U.S. Postal Inspection Service (USPIS) and my local police (in my case the Los Angeles County Sheriff Department).
12/12/25, Friday
I immediately went to my CU branch office to submit my completed Affidavit that they notarized for free and forwarded to their forgery department that would now be empowered to seek a $3,500 refund for my checking account.
12/12/25, Friday
Posted to my CU Family Trust Checking Account was a $3,500.00 Deposit - Return: Check #1940 Tracer xx2018, Category: Refunds/Adjustments.
To my complete surprise, I found this post on Sunday, 12/14/25!!!
12/15/2025, Monday
Via a cell phone call to a Veteran Affairs agent, I was able to quickly change my checking account number associated with my Direct Deposit by 12/18/25, the cut off date that would ensure receiving my VA disability benefit payment on time. The VA agent did confirm my identify by asking a list of questions, e.g., month/year of starting and leaving active duty.
!2/16/25, Tuesday
Since my wife and I did not have online Social Security accounts and could not change our checking account number via a phone call, we had to go in-person to a local Social Security Office (10 minute drive from our residence) to make Direct Deposit changes. At the 9 am opening, we were first in the no appointment line and were in and out in 15 minutes, making our changes by the 12/18/25 cut off date ensured receiving our Social Security deposits on time.
12/17/25, Wednesday
I received the mail shipment of checks ordered by my CU with the new checking account number,.
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BTW, my check #1940 was a $250 payment to my Homeowners Association (HOA), mailed to the HOA, c/o a P.O. Box number, Los Angeles. CA, i.e., a P.O.B. number of a financial company that processes check payments. All my outgoing mail is deposited in the mail slot located within my local post office, and I never use USPS mailboxes. My mailed check could have been stolen by a USPS employee or an employee of the financial company. My HOA recently changed its management company that I called to report my incident. The new HOA management company offers auto pay that I subsequently have signed up for.
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How serious are mail theft and postal fraud?
Here are two recent State of California and Federal cases worth reading.
09/19/2025 Press Release, State of California Department of Justice
Attorney General Bonta Announces 72 Felony Convictions in Organized Criminal Postal Theft and Bank Fraud Scheme
OAKLAND – California Attorney General Rob Bonta today announced the felony convictions of 72 individuals involved in a widespread mail theft and postal fraud operation that resulted in the theft of nearly $6 million from hundreds of people. The defendants — who operated out of multiple counties across California, including Los Angeles County and San Bernardino County [my bold highlight] — allegedly altered stolen checks, deposited them into bank accounts, then quickly withdrew money from ATMs before the banks discovered the checks were forged. Following a complex multi-jurisdictional investigation — led by the United States Postal Investigation Services Mail Theft/Violent Crimes Team, with assistance from the California Department of Justice’s E-Crimes Unit, and local law enforcement — the defendants were indicted by a grand jury on charges of conspiracy to commit grand theft by false pretenses, forgery, and grand theft, with an aggravated white collar crime allegation. Of the 72 defendants who obtained felony convictions, 25 pled to prison sentences. Depending on the level of culpability and other sentencing factors, sentences range from between 16 months to eight years in prison.
The scheme was carried out by an organized criminal enterprise, and postal employees were recruited to assist with stealing checks from the mail. The suspects allegedly began the postal fraud and check washing operation in 2018 and used hundreds of accounts at major banking institutions to carry out their crimes, which victimized more than 750 Californians. Investigators believe the stolen money was used to fund other criminal operations.
As part of the scheme, stolen and altered checks were deposited through bank accounts, and defendants withdrew the money before the bank discovered the checks were altered. Individuals were recruited to “sell” their bank accounts for use in the scheme to earn quick money. Some defendants participated in the theft of mail and the “washing” of checks. A check is washed by using solvent to erase the payee section of the check. A forger would wash the check and replace the payee with the name of another conspirator. The “new” payee would open a bank account for the purposes of the fraud. The check would be deposited in the account, and since the check was real and written off of a real account it would clear. In many instances the conspirators were able to withdraw thousands of dollars from a single account. When the fraud was discovered, the known fraud accounts were closed.
California Department of Justice’s Special Prosecution Section prosecuted this case. The prosecution is the culmination of a years-long investigation by the U.S. Postal Inspection Service, with assistance from 34 teams from local, state and federal agencies. The bulk of the arrests were made during an enforcement sweep across the counties of Los Angeles and San Bernardino. Operation “Checks in the Mail” comprised 16 teams from the Los Angeles County Sheriff’s Department and eight teams from the U.S. Postal Inspection Service, in addition to teams from the Los Angeles Police Department, Bakersfield Police Department, Hermosa Beach Police Department, Homeland Security Investigations, U.S. Marshals, California State Parole Agents, Los Angeles County Probation, Long Beach Police Department, and the Los Angeles Department of Children and Family Services.
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Monday, December 8, 2025
Carson Woman and Former U.S. Postal Service Employee Sentenced to More Than 5 Years in Federal Prison for Stealing Checks and Credit Cards from Mail
LOS ANGELES – A South Bay woman who formerly worked as a letter carrier for the United States Postal Service in Torrance was sentenced today to 63 months in federal prison for stealing checks and debit and credit cards from the mail then selling them to her accomplices for three years, using the illicitly obtained funds to take international trips and buy luxury goods, and then flaunting the cash on Instagram
Mary Ann Magdamit, 31, of Carson, was sentenced by United States District Judge John F. Walter, who also ordered her to pay $660,200 in restitution.
From at least 2022 until July 2025, Magdamit stole mail containing checks, personal identifying information (PII), and debit and credit cards. She then activated the stolen bank-issued cards online, used the cards to make purchases, and sold some stolen cards to her co-conspirators.
She also arranged to have her co-conspirators cash the stolen checks, usually by people using counterfeit identity documents in the name of the check’s payee. Federally insured banks and credit unions were victimized in this scheme.
Law enforcement searched Magdamit’s apartment in December 2024, and seized 133 stolen credit and debit cards,16 U.S. Department of Treasury checks, and a loaded, un-serialized Glock-clone, with an extended 27-round magazine, commonly referred to as a “ghost gun.” Agents also discovered luxury goods purchased with cards she stole from the mail. She also used stolen cards on international trips she took to Turks and Caicos and Aruba.
“Individuals, businesses, and governments rely on the Postal Service to deliver over 100 million pieces of first-class mail daily,” prosecutors argued in a sentencing memorandum. “Especially for the poorest Americans, who are often unbanked, they rely on the mail to deliver their government benefits in the form of Treasury checks or EDD debit cards, precisely what [Magdamit] chose to steal.”
The United States Postal Service Office of Inspector General, the United States Postal Inspection Service, and the Treasury Inspector General of Tax Administration investigated this matter. Assistant United States Attorney Andrew Brown of the Major Frauds Section prosecuted this case.
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I’ll end my long post with positive regards,
Mele Kalikimaka me ka Hau’oli Makahiki Hou!
(Merry Christmas and Happy New Year in Hawaiian)
Ray