Positive Pay and SafePay in the USA

Positive Pay is one of the most important tools available in preventing check fraud. Created many years ago and offered by many banks, Positive Pay is an automated check matching service.

We have successfully helped clients in Los Angeles and throughout the United States stop most (not all) counterfeit and altered checks using this method. When Positive Pay is used with high security checks, fraud losses can be cut dramatically.

Stacks Image 36Caution: Some people believe that if they use Positive Pay, they do not need to use high security checks. This is a serious misconception. An analogy will illuminate this misconception: Using Positive Pay is like catching a thief standing in your living room holding your jewels. While it is good that the thief was caught, it would be preferable to have the thief look at your house and decide to go next door. This is where high security checks are important. They DETER, or discourage, the criminal from trying fraud against your organization. Both high security checks and Positive Pay are imperative for an effective check fraud prevention strategy.

A company electronically sends information to its bank about the checks it has written. This is called a check-issue file. The check-issue file has the account number, check number, issue date, and dollar amount of each check.

Sometimes the payee name is included, but it is not always part of the Positive Pay service. A check-issue file should be sent to the bank each day checks are written.

When a check is presented at the bank for payment and does not have a “match” in the file, it becomes an “exception item.” The bank sends a fax or an image of the exception item to the company. The company reviews the item and instructs the bank to either pay or return the check.

There is a fee charged by the bank for Positive Pay. The fee might well be considered an "insurance premium" to help avoid check fraud losses and liability.

Stacks Image 117The biggest obstacle to using Positive Pay is a company’s inability to extract and format a check issue file and securely send the information to its bank. SAFEChecks created SafePay, a Positive Pay formatting and transmission software that enables organizations to use their bank's Positive Pay services. SafePay is PC-based and is compatible with all accounting system export files and check writing software.

The SafePay package (SafePay123) comes with:

• The SafePay software
• A free order of high security business checks (SAFEChecks or the Abagnale SuperBusinessCheck)
• A free order of high security personal checks (the Abagnale Supercheck)

For detailed information about SafePay software, click on SafePay Product Booklet in the sidebar on the upper right side of this page. SAFEChecks’ secure check writing software also has Positive Pay functionality. It will create a check issue file automatically as the checks are being written and will securely send it to the bank.