The best way to reduce your losses is to avoid taking bad checks from the start. What follows is a recommended procedure for accepting checks:

Confirm the identity of the check writer.
The most reliable form of I.D. is that which contains a photo (such as a valid driver’s license) which includes a physical description. Take the I.D. in hand and write the I.D. number, birth date, address and other descriptive data on the front of the check.

The signature should be legible and signed in the presence of the individual accepting the check.
Do NOT accept previously signed checks. For a company check, it is vital that the signature is legible. If not, print the individual's name on the front of the check.

The complete address should be imprinted on the check.
Require a street address, in addition to a P.O. Box number. Obtain a phone number as well.

Accept checks only written with today's date.
Pre- or post-dated checks are not accepted in the Bad Check Restitution Program and cannot typically be criminally prosecuted. This restricts any recourse you may have against the check writer if your own collection attempts fail.

Make sure written amounts and numbers correspond.
Banks will usually not honor checks with discrepancies between written amounts and numbers.