Negotiable instrument with fraud protection

• US 20060144924A1
• Filed: 03/09/2006
• Published: 07/06/2006
• Est. Priority Date: 10/29/2003
• Status: Active Grant

• Current Assignee: Merlin D. Stover
• Original Assignee: Merlin D. Stover
• Inventors: Stover, Merlin D.
• Granted Patent: US 8,052,040 B2
• Time in Patent Office: Days
• US Class Current: 235/379
• CPC Class Codes: B42D 25/29 Securities; Bank notes
• CPC Class Codes: G06Q 20/042 characterized in that the payment protocol involves at least one cheque
• CPC Class Codes: G07F 7/08 by coded identity card or credit card or other personal identification means without personal verification means G07F7/02
• CPC Class Codes: G07F 7/12 Card verification

Abstract

A negotiable instrument with fraud and identity theft protection and method of use is provided. The method includes step accepting a negotiable instrument having a pre-printed bar code, reading the bar code on a negotiable instrument using a bar code scanner, and receiving from the writer a code presented to the merchant for deriving personal information associated with the account holder and banking information associated with the account from the bar code. The method also having the step of comparing the personal identification information from the bar code with information provided by the writer. The merchant using the bank processing information derived from the bar code to process the negotiable instrument.

Claims

1. A method of using a fraud and identity theft resistant checking account to avoid acceptance by a merchant of a fraudulent check and to preserve the identity of an account holder, the method comprising:

receiving a negotiable instrument from a check writer having a pre-printed bar code and an identification theft protection hotline;

concealing from view by using the pre-printed bar code to encode personal and bank identification information;

receiving a code with the check, the code being associated with the checking account for deriving personal and bank identification information from the pre-printed bar code;

comparing the personal identification information of the account holder to the check writer;

determining by the merchant whether to accept or refuse the check at the point and time of the transaction by comparing the check writer with the personal identification information of the account holder derived from the bar code;

processing by the merchant of the check for payment by using the bank identification information derived from the bar code;

contacting by the merchant the identification theft hotline at the point and time of the transaction to alert a bank associated with the checking account of a fraudulent use of the check, personal information or banking information associated with the account.

2. The method of claim 1 wherein the personal identification information of the account holder comprises a signature, an address, a phone number, a name of the account holder, a date of birth (DOB), a sex, a height, a weight, a hair color and an eye color.

3. The method of claim 1 wherein the banking identification information comprises a bank routing number, a bank account number and a check number.

4. The method of claim 1 further comprising the step of comparing the check writer to a photo identification of the account holder on the check and comparing the signature of the account holder derived from the pre-printed bar code with the signature of the check writer placed upon the check at the point and time of the transaction.

5. A system for protecting against fraudulent check transactions having a fraud and identity theft resistant account for use at the point and time of a transaction, comprising:

a negotiable instrument associated with an account and an account holder, the instrument having an identification theft protection hotline;

a pre-printed bar code for hiding personal information about the account holder and bank processing information about the account;

a bar code scanner for scanning the pre-printed bar code on the negotiable instrument;

a code associated with the account and provided by a writer for viewing the hidden personal information and bank processing information;

a display adapted for displaying the personal information about the account holder and the bank processing information about the account to assist a merchant in verifying the identity of the account holder against the identity of the writer of the negotiable instrument, the bank processing information being used by the merchant to process the negotiable instrument at the point and time of the transaction.

6. The negotiable instrument of claim 5 wherein the merchant uses the identification theft protection hotline to alert the bank associated with the account of a fraudulent use of the negotiable instrument, the personal or banking information associated with the account.

7. The negotiable instrument of claim 5 wherein the personal information is from a group consisting of a name listed on the account, an address, a telephone number, a social security number, and a driver'"'"'s license number.

8. The negotiable instrument of claim 7 wherein the personal information further comprises a digital photograph and a signature of the account holder.

9. The negotiable instrument of claim 5 wherein the bank processing information hidden within the pre-printed bar code comprises a bank account number, a bank routing number and a check number.

10. The negotiable instrument of claim 5 wherein the code associated with the account is entered into a code-receiving device, the scanner scanning the pre-printed bar code, reading the pre-printed bar code and displaying on the display the personal and banking information of the account holder at the point and the time of the transaction when the code entered by the check writer matches the code associated with the account.

11. The negotiable instrument of claim 5 wherein the writer includes a second code associated with the account on the check for deriving the personal and banking information when the writer is not physically present at the point and time of the transaction.

12. The negotiable instrument of claim 5 wherein the personal and bank identification information is only viewable by the merchant at the point and time of the transaction after receiving from the writer the code for deriving the pre-printed bar code.

13. A method of using a fraud and identity theft resistant checking account to avoid acceptance by a merchant of a fraudulent check and to preserve the identity of an account holder, the method comprising:

receiving a negotiable instrument from a check writer having a pre-printed bar code and an identification theft protection hotline;

concealing from view by using the pre-printed bar code to encode personal identification information comprising a digital photo identification, a signature, an address, a phone number and a name of the account holder;

concealing from view by using the pre-printed bar code to encode bank identification information comprising a bank routing number, a bank account number and a check number;

scanning the pre-printed bar code;

receiving a code with the check, the code being associated with the checking account for deriving personal and bank identification information from the pre-printed bar code;

comparing the personal identification information of the account holder derived from the pre-printed bar code with the address, the phone number and the name of the check writer;

comparing the photo identification of the account holder derived from the pre-printed bar code with the check writer;

comparing the signature of the account holder derived from the pre-printed bar code with the signature placed by the check writer upon the check at the point and time of the transaction;

determining by the merchant whether to accept or refuse the check at the point and time of the transaction by verifying a match between the identity of the account holder and the check writer based on the steps of comparing the personal identification information derived from the pre-printed bar code with the information provided by the check writer, comparing the photo identification of the account holder derived from the pre-printed bar code with the check writer, and comparing the signature of the account holder derived from the pre-printed bar code with the signature of the check writer placed upon the check at the point and time of the transaction;

processing by the merchant of the check for payment by using the bank routing number, the bank account number and the check number derived from the pre-printed bar code; and

contacting by the merchant the identification theft hotline at the point and time of the transaction to alert a bank associated with the checking account of a fraudulent use of the check, the personal or banking information associated with the account.

14. The method of claim 13 wherein a pre-printed signature of the account holder is visible on the check and not hidden from view using the pre-printed bar code.

15. The method of claim 13 further comprising the step of comparing the pre-printed signature of the account holder upon the check with the signature of check writer placed upon the check before receiving the code to derive the personal and bank identification information from the pre-printed bar code.

16. The method of claim 13 wherein the photo identification of the account holder is visible on the check and not hidden from view using the pre-printed bar code.

17. The method of claim 16 further comprising the step of comparing the photo identification upon the check to the check writer before receiving the code to derive the personal and bank identification information from the pre-printed bar code.

18. The method of claim 13 wherein the personal and bank identification information is only viewable by the merchant at the point and time of the transaction after receiving the code from the check writer.

19. The method of claim 13 further comprising the step of writing a second code associated with the account on the check for deriving the personal and banking information when the check writer is not physically present at the point and time of the transaction.

20. The method of claim 13 further comprising the step of entering by the check writer the code associated with the account into a code-receiving device for deriving the personal and banking information associated with the account.