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CHECK KITING IS A FRAUD committed against a banking institution, in which the underlying premise is to gain access to deposited funds before they are collected from the institution upon which they are drawn. The scam usually involves several checking accounts spread between several banks. In effect, a bank deposits money into an account while waiting for cash to be processed from another account; while in actuality the other account holds no money. An example of check kiting would be as follows:

Monday. A prospective check-kiter deposits a $500 check from account A into account B; then shortly thereafter deposits a $500 check from account B into account A.

Tuesday. Another round of deposits are made as well as some partial withdrawals.

Wednesday. One bank collects its monies ...

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