Frequent check deposits in round numbers or for the same amount and checks written to individuals for large, even amounts might be indicators of which type of fraud?

• A. True
• B. False
• C. Sometimes
• D. Not at all

Answer: (A)

Recognizing red flags in financial activity helps identify potential fraud such as money laundering. Frequent check deposits in round numbers or the same amount suggest structuring—placing illicit funds into the banking system in predictable increments to stay under reporting thresholds and to avoid suspicion. When deposits repeat at identical amounts, it signals a deliberate pattern rather than ordinary business cash flow. Likewise, checks written to individuals for large, even amounts can indicate payments to intermediaries or “fronts” used to move or disguise funds rather than legitimate expenses to vendors. When both patterns appear together, they point toward illicit funds being moved and integrated, a hallmark of money laundering activity. While not definitive proof on its own, these are strong red flags and would be considered indicators of potential fraud.