3–38. Avoid Acronym Payees on Checks
When a company enters an acronym for a payee name on a check, there is a heightened risk that someone could fraudulently alter the acronym, so that the check can be paid to a different entity. For example, someone could easily add a single letter to the acronym on a check made payable to the NAC (National Arts Center), changing it to NACM (National Association for Credit Managers).
To avoid this type of fraud, always fully spell out the name of the payee on a check. Since a computerized accounting system draws the payee name from the vendor master file, this may require a review of that file to ascertain if any acronyms are currently being used.
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