Usually, demand drafts are perfectly legal. These checks are generated by a third party (no signature required) and can be used to pay a bill. For example, if you buy something over the phone, you may be able to authorize the seller to take the money out of your checking account through a demand draft.
So how does this affect you? Criminals have figured out how to use demand drafts to pay for their purchases on your dime.
To protect yourself:
- Treat your checking account number like a credit card number; don’t give it out to anyone you don’t know or trust.
- Keep your checkbook safe; your checks contain your account number and SEFCU's routing number.
- If you don’t want to pay via check or demand draft, consider cash or credit.
- Remember, legitimate companies using demand drafts will tell you how much they’re debiting, and will state that they’ll only use the information to obtain payment for whatever they’re providing.