In an ongoing effort to combat check fraud, a new feature from ParaScript could offer significant support. Specializing in AI-driven document processing, ParaScript has recently enhanced its check recognition solution, CheckXpert.AI, with a capability that automatically detects and interprets handwritten or stamped endorsements on the back of checks.

A Key Enhancement to CheckXpert.AI

The updated feature allows the system to identify common phrases such as For mobile deposit only” or Deposit only to account of payee.” It intelligently aligns the check’s orientation and cross-references it against a customizable list of authorized statements. Any endorsements that seem missing, suspicious, or unauthorized are flagged immediately.

Benefits and Real-Time Monitoring

This improvement ensures that checks are deposited through legitimate channels and significantly reduces the risk of fraud. However, it’s important to note that ParaScript’s tool does not verify handwriting authenticity or match signatures to those on file—capabilities available with some other investigative tools.

Practical Advancements in Fraud Detection

The automation of endorsement verification addresses a recurring issue within remote deposit processes and is seen as a practical enhancement. According to Jennifer Pitt, a Senior Analyst at Javelin Strategy & Research, Most fraud tools focus on signatures or altered fields, but this fills a smaller gap by ensuring the back of the check says what it should. It does this in real time, flagging issues before checks are accepted.”

Pitt adds, “It’s not a major leap in handwriting analysis, but it’s a practical improvement for banks dealing with high deposit volumes or stringent compliance requirements.” The tool helps reduce manual review and ensures more consistent enforcement of basic controls.

AI’s Role in the Fight Against Check Fraud

The role of artificial intelligence is rapidly expanding in the fight against check fraud. With nearly 23% of benefit recipients still receiving assistance through checks or vouchers, the federal government has been employing AI to detect fraud with impressive results. According to CNN, machine learning technology helped recover $1 billion in check fraud during fiscal year 2024—nearly tripling the amount recovered from the previous year.

Despite these advancements and significant instances of fraud recovery, many organizations are not prioritizing check fraud detection solutions. Only 22% of companies surveyed by Javelin said they use such tools.