Top 5 Mobile Deposit Risks: How Awareness Can Improve Your Deposit Strategy

Depositing a check looks vastly different than it did decades ago. With the snap of a camera and a few taps to complete the process, a deposit in today’s world offers the “anytime, anywhere” convenience members expect. Behind that simple experience, however, are risks that credit unions must manage to avoid financial losses, processing disruptions and damaged member trust.

The stakes are substantial: FinCEN reported more than 680,000 check-related Suspicious Activity Reports in 2022—nearly double the previous year’s filings. Mobile and remote deposit capture (RDC) require clear policies, informed oversight and coordinated controls.

There are five common risk areas where mobile and RDC fraud can take root, giving your credit union the opportunity to stay aware and plan ahead. The goal is to strengthen protections against mobile deposit fraud while preserving a seamless member experience.

1. Duplicate Checks

One item, multiple deposits. A check deposited through an app can be taken into a physical branch, presented through another channel or deposited at another institution. Whether accidental or intentional, duplicate deposits can trigger losses, disputes and time-consuming recovery efforts.

Potential Risks:

• The payer’s account could be charged twice, leading to a less-than-ideal member experience.
• The paying institution will dishonor one of the deposits, leaving both depositing institutions at risk of return. The first financial depositing institution could also be at risk to an RDC indemnity claim from the second depositing institution.
• Compliance issues, particularly with Reg CC and Liability Exposure.

Protections in Practice:

• Consider duplicate detection software through your mobile vendor or check processor. Understand it’s capabilities and limitations across channels, timelines and institutions.
• Require restrictive endorsements and explain them for members clearly in the app. Give straightforward instructions for retaining, securing and destroying deposited checks, including a reminder never to redeposit an accepted item.
• Establish an escalation process for duplicate alerts, so they can be addressed quickly, as well as in accordance with industry regulations and your credit union’s risk policies.

2. Fraudulent and Altered Checks

When the image hides the risk. Even in the age of AI, check fraud remains a significant threat. Counterfeit or altered checks can come about when a check is intercepted or stolen, then washed of its original ink or digitally or physically changed so the deposit amount is higher than what was originally listed. Fraudulent checks can turn routine deposits into losses, and an image alone may not reveal obvious alteration. If funds are deposited before the fraud is identified, recovery becomes more difficult.

Potential Risks:

• Financial losses for your members and your credit union.
• Increased member disputes.
• Returned items.
• Potential liability for credit unions, especially during the “squeeze” period. Under Reg CC, institutions are legally required to make deposited funds available to members quickly, often within a business day or two.

Protections in Practice:

• Define image-review standards and flag unusual amounts, inconsistent check details and deposits outside normal account behavior.
• Train staff regularly on emerging fraud patterns, so they are aware of fraud trends.
• Restrict mobile and RDC capabilities until members work pass prequalification standards.
• Implement controls around daily and monthly dollar limits, with appropriate thresholds and restrictions for new accounts.
• Connect to a shared national database to verify the legitimacy of check routing numbers, account numbers, closed accounts and historical NSF flags prior to accepting and processing the deposit.

3. Compliance and Operational Gaps

Small failures, larger consequences. Even legitimate deposits can create problems when there’s a breakdown in posting, reconciliation, returns or exception handling. Unclear responsibilities and inconsistent procedures can compound losses, delay resolution and expose the credit union to compliance issues.

Potential Risks:

• Financial losses for your credit union.
• Regulatory violations, leading to even greater losses—financial and beyond.
• Operational errors, such as delayed returns and errors in posting funds to member accounts.
• Reputational damage resulting in loss of member trust.

Protections in Practice:

• Document the deposit process from submission through settlement and returns. Test procedures regularly, track unresolved exceptions and review trends with management.
• Assign owners and backup coverage for reconciliation, exception review and time-sensitive decisions.
• Establish funds-availability controls deposit limits.
• Educate members on the deposit process and mobile/RDC schemes so they can act as another watchful eye and prevent fraud from entering your institution.
• Understand and monitor third-party responsibilities in the process so issues do not stall between teams.

4. Inadequate Member and Deposit Controls

Avoid a one-size-fits-all approach. According  to a 2016 Guardian Analytics research survey, 72 percent of fraud targeting mobile banking apps involved RDC and fraudulent checks. Without controls tailored to account performance and behavior, suspicious deposits may go undetected, increasing your credit union’s vulnerability to possible deposit capture fraud and exposure to losses.

Potential Risks:

• Unnecessarily high deposit limits.
• Weak authentication practices.
• Insufficient or limited account monitoring.
• Unclear member agreements that lack defined deposit responsibilities, restrictions and retention procedures.

Protections in Practice:

• Set data-driven member eligibility criteria and deposit limits using account relationships, deposit history and observed behavior. You can review and update limits as those factors change.
• Strengthen identity verification at account opening.
• Increase verified authentication for members’ digital access.
• Perform daily monitoring for unusual deposit activity and establish thresholds when additional review may be necessary.
• Revisit and update policies to expand on deposit limits and increase controls.
• Update agreements and member education to explain endorsements, restrictions, check retention and how to report suspected fraud.

5. Cybersecurity and Vendor Risk

Protection beyond your own systems. America’s Credit Unions reports that credit unions observed a 55 percent increase in trojan-enabled fraud accessed via remote environments in 2025, accounting for 15 percent of all credit union fraud. Although broader than deposit fraud, this trend underscores the need to protect digital access from all possible angles, including through your vendors and outside cybersecurity attacks. Stolen credentials, exposed check images and provider disruptions can threaten member information and deposit availability.

Potential Risks:

• Insufficient or lack of regulatory oversight from vendors.
• Phishing attempts.
• Identity theft.
• Service interruptions.
• Processing delays.

Protections in Practice:

• Perform rigorous due diligence to review vendor security, compliance practices, incident-notification commitments and business continuity capabilities.
• Establish and test internal business continuity plans to address system interruptions and delays with information security and member-facing teams. Clarify which teams and employees manage check images through transmission and storage.
• Determine targeted channels for members to communicate real-time delays and service disruptions with expectations and alternative deposit options.
• Reinforce member education on phishing and credential protection.

Turn Awareness Into a Stronger Deposit Strategy

A stronger deposit strategy starts with turning each risk into a decision. These five risk areas are a good starting point to compare your current safeguards with potential protections, then identify the gaps that need attention first.

Track fraud losses alongside review times, unresolved issues and member complaints to understand whether your changes improve protection without creating unnecessary delays. Review progress periodically and adjust your approach as fraud patterns and member needs evolve.

Awareness identifies the risks—clear priorities, accountable follow-through and regular measurement turn that knowledge into safer, more dependable deposit services.

Anthony Greco is the product manager of payments & consumer technology at Vizo Financial. His role involves education, support and strategic planning to help grow credit unions utilize payment solutions that add value to their institutions.

Kayla Kuriger is the product manager of capture services & checks at Vizo Financial. Her role involves the development and sales of capture & check services, as well as fraud solutions, and the management of vendor and reseller relationships.