Police swoop on cheque suspects

By CLAIRE TREVETT

Police raids have ended the third major cheque scam to hit Auckland in two years.

Waitakere police searched properties yesterday and arrested several people believed to have netted about $300,000 from cheque thefts between February and June.

The arrests were part of a joint police and New Zealand Post investigation which started three months ago after reports of cheque theft and alterations.

Cheques sent by businesses in North Shore and Waitakere were the main targets.

Detective Sergeant Stan Brown, of Waitakere, said six or seven people had worked together, taking cheques which were then "washed" at different banks around Auckland.

Details on the cheques were altered, with up to $15,000 added to their value.

Fake identification was then used to open new bank accounts and the altered cheques were deposited. Once the cheque cleared, the money was withdrawn.

Police were trying to isolate the point at which the cheques were taken, unsure whether it was as they went through the postal system or after they arrived in letter boxes.

Mr Brown said police did not yet know if NZ Post staff were involved in the scheme.

"There's nothing for us to say yes or no about that yet. There are still things for us to look at. We do not know yet at what point the cheques are going missing."

He would not say how people were arrested because officers were still looking for other suspects in relation to the same case.

Those arrested would appear in North Shore District Court from today on charges relating to theft and fraud.

New Zealand Post was hit by scandal in April this year when about 20 people, many of them staff or contractors of NZ Post, were arrested after an investigation into missing mail and courier packages.

A spokeswoman for NZ Post said its security and investigation team was helping the police investigate the latest scam, but NZ Post could not comment until it was completed.

Its security team was constantly looking at ways to prevent the postal system from being abused.

The recent cheque scam is at the third in the past two years involving large-scale cheque fraud.

In April this year, more than $1 million was taken in a cheque scam that hit Auckland companies. The cheques were sent via courier companies and were either altered or duplicated before being presented to the bank.

The scam led the National Bank to advise customers to reconcile their bank accounts on a daily basis to ensure the fraudsters had not hit them.

In December 2001, 70 people were arrested for cheque and credit card fraud. Some had operated in groups, stealing cheque books and credit cards from cars, letterboxes and people.

New Zealand Bankers' Association figures showed the use of payments by paper, including cheques and bank deposit slips, had dropped significantly as people increased their use of Eftpos and internet banking.

KPMG's financial institutions performance survey said the popularity of cheques was declining, partly because other methods of payment were safer.

"While banks do not have any public plans to phase out cheques, it is something that will ultimately occur."

But Westpac Bank spokesman Paul Gregory said cheques could be around for a long time.

"People might prefer using cheques. They might not have access to the internet or they might live out of town," Mr Gregory said. "It's just the way many prefer to bank."

He said people could safeguard against theft by putting locks on their letterbox and collecting new chequebooks at their bank.

Westpac Bank would not post credit cards out to areas repeatedly hit by thefts, asking customers to pick cards up at the bank.