Checks

• Casinos often issue checks upon chip redemption, effectively transforming illicit cash or chip balances into what appear to be legitimate gambling proceeds.
• The rapid redemption of chips for checks—without substantial gameplay—helps conceal the funds’ criminal origins.
• Checks can then be deposited into bank accounts or further circulated, benefiting from the perception of legitimate 'casino winnings.'

• By altering payee information, amounts, or signatures on checks, criminals can fabricate legitimate-looking payments from forged documents.
• This technique secures unauthorized disbursements from accounts, allowing launderers to transfer and integrate illicit proceeds under the guise of routine transactions.

• After receiving physical US dollars from criminal sources, the peso broker may deposit them into an account and issue checks payable to exporters.
• Checks labeled as legitimate business payments disguise the true origin of funds, complicating the detection of illicit proceeds.
• This layer of separation (cash-to-account-to-check) aids in obscuring the criminal source behind ordinary commercial transactions.

Cashier’s or business checks are purchased with bulk cash or account balances and then redeposited or used to buy assets, providing a negotiable instrument that distances funds from the initial cash placement while retaining the legitimacy of “business payments”.

• Non-profit organizations frequently accept checks as donations, enabling criminals to funnel illicit proceeds under the guise of legitimate philanthropic contributions.
• Complicit staff or lax verification processes can prevent proper scrutiny of check donors, allowing criminals to use multiple checks from different sources or accounts to layer funds.
• Once deposited in the charity’s account, the illicit origins become obscured by the perceived legitimacy of charitable donations.

Physical or PDF cheque stock is reprinted so the payee line shows the alias; because cheque-clearing often trusts the payee field, the altered name evades historical SAR linkage.

• Offenders issue checks under misleading narratives, citing reasons like 'charitable donations' or 'service payments' to legitimize the transfer.
• The memo line and accompanying records provide an opportunity to falsely characterize the transaction’s purpose, obscuring illicit sources of funds.

• Criminals issue checks labeled as arbitral “settlement payments,” giving the appearance of a legitimate legal outcome.
• By presenting official or certified checks tied to staged arbitration awards, illicit funds can be deposited into the financial system with minimal suspicion, as they seem to stem from a valid judicial or quasi-judicial process.
• This mechanism bypasses typical AML alerts because supporting documentation (the ‘arbitration award’) lends credibility to otherwise dubious transfers.

• Casinos may issue checks for larger TITO redemptions, offering a credible bank-drawn instrument.
• Criminals deposit these checks into their accounts, where they appear legitimate due to the casino’s reputable status.
• The check form factor further distances the funds from their original cash source, complicating financial institution scrutiny.

Some employers still issue paper or electronic checks for payroll. Criminals insert ghost employees or inflate wages, then write checks payable to personal or controlled accounts:

• The checks appear as standard payroll expenses, concealing illicit funds under typically unquestioned payment processes.
• Fraudsters can deposit or cash these checks, integrating illicit proceeds into the financial system under the guise of regular compensation.

• Criminals instruct unrelated third parties to issue checks from personal or business accounts on the criminal’s behalf.
• Transactions appear legitimate because the checks come from external sources, distancing the launderer from the funds.
• Using multiple payers and structuring amounts across various checks reduces flags for unusual account activity, complicating anti-money laundering oversight.

• Companies issue checks to false creditors, recording them as normal payables in internal bookkeeping.
• The physical or electronic checks appear as legitimate business payments, helping criminals mask outflows of illicit funds.
• This method leverages the routine nature of check payments, making it harder for auditors or financial institutions to detect the deceptive transactions.

• Criminals leverage remote deposit capture to submit physically altered or stolen checks from locations away from a branch, sidestepping face-to-face scrutiny.
• They often deposit near-identical checks sequentially into multiple accounts, quickly moving funds before financial institutions detect discrepancies.
• The automated, non-face-to-face nature of remote deposit simplifies introducing counterfeit or duplicated checks into the system.

• Criminals physically or digitally overwrite amounts, modify payee details, or forge signatures on checks.
• These altered checks then enter clearing processes as if genuine, masking the true origin or purpose of funds.
• The apparent legitimacy of check-based transactions makes detecting tampering more challenging for standard AML reviews.

• Criminals may use checks from unrelated third-party sources to purchase real estate through unlicensed brokers.
• These brokers typically do not perform enhanced due diligence on the check origin or payer.
• This strategy layers illicit funds from various sources, obscuring the trail and beneficial owner.

• Companies often issue checks for employee expense reimbursements.
• By submitting bogus receipts, perpetrators secure checks for non-existent or over-reported outlays, then deposit or cash them, integrating illicit proceeds into their personal finances under the guise of valid reimbursements.

• Criminals deposit fraudulent (e.g., NSF or washed) checks into newly opened or existing accounts, exploiting float periods or delayed clearing to receive temporary credit.
• By the time these checks are flagged as worthless and returned unpaid, the illicit actors have often withdrawn or transferred the credited funds.
• Stolen checks may be chemically altered to change payee or amount details, further facilitating unauthorized withdrawals or purchases.

• Illicit payroll funds are often disbursed through checks drawn on underreported payroll accounts or shell company accounts.
• Employees, frequently undocumented, then cash these checks at check-cashing services, bypassing deeper scrutiny by traditional banks.
• This process conceals the actual workforce size and wage disbursements, impeding accurate tracking of owed payroll taxes.