DALLAS — With check volume shifting to electronic clearing networks, bankers are starting to pay more attention to cases where images are attached to the wrong data.
The "image integrity" problem is considered rare — executives say it affects less than 0.1% of checks — but with 30 billion paper checks passing through banks in 2006, it happens frequently enough to be worrisome, officials said Tuesday at the Bank Administration Institute's TransPay conference.
Mismatches typically occur during sorter jams, and even though bankers typically re-run about 30 to 50 checks that precede the ones that cause jams as a safety precaution, some errors still get through, the officials said.
And even occasional errors could be damaging to banks' reputations, because they could expose customers' personal information to unauthorized people.
Both the Federal Reserve Board and Viewpointe LLC, which operates a massive shared check archive, said they plan to step up efforts this year to improve image integrity.
Viewpointe's plans were more specific than the Fed's. The New York archive and payments company, which serves some of the country's biggest banking companies, said it would introduce an image evaluation service by midyear.
Kerry Atha, Viewpointe's director of product management, said at a press conference that SunTrust Banks Inc. of Atlanta would be the first customer for the service and plans to test it starting next quarter.
Initially, SunTrust will use the service on incoming image cash letters to verify that the check images are attached to the correct account data before posting the payments to customers' accounts, Ms. Atha said.
Viewpointe plans to offer the service to all the banking companies that use its image-sharing service or its Pointe2Pointe image exchange service, she said; the vendor also may offer the service to other companies.
"We are exploring opportunities to license it not only to other partners and other providers, but we also are looking at what we call a channel-level solution,"Ms. Atha said.
In principle, a bank could scan all incoming checks, or only those from specific trading partners or routing numbers, but it probably would not be appropriate to select which checks to scan according to the dollar amount, Ms. Atha said. "If it's a two-cent check or a $2 million check, a privacy breach is a privacy breach."
Images that undergo the scans would be certified with what the company is calling the "Viewpointe Integrity Stamp," which would be placed in the header of the file to eliminate redundant processing.
A crucial feature of the service is the use of "optical character interrogation" technology, which was developed by Fiserv Inc., to compare the data associated with the image, such as the contents of the magnetic ink character recognition line, with the original image itself.
Last month Fiserv agreed to transfer its clients' images to the Viewpointe archive, from an archive that the Brookfield, Wis., company has long maintained for itself.
Ms. Atha said the service has been under development for 18 months and was unrelated to Viewpointe's archiving agreement with Fiserv.
Brian Egan, a vice president of the Federal Reserve Bank of Atlanta, said that image integrity is the next big issue the industry needs to address, now that banks and vendors have largely resolved the issues surrounding check image quality.
"The reality is that image quality is better than a lot of us thought," Mr. Egan said.
An important element of the Fed's effort will be to reduce the number of "false positives," which is now so high that human examiners miss the rare mismatches, he said.
Ninety percent of incidents that look like mismatches are false positives, Mr. Egan said. "That doesn't help the industry."
