ARLINGTON, Va.-Banks have experienced an alarming rate of increase in fraud, according to a new study of bank deposit fraud prevention practices. "Bank deposit fraud is growing at an alarming rate, not only geographically but also in the sophistication of its methods," according to Preventing Deposit Fraud: Effective Strategies for Banks, prepared by KPMG LLP's Risk and Advisory Services Practice. Consumer Bankers of America President Joe Belew said, "The challenge for our members is to deploy state-of-the-art technology and procedures to control a problem that threatens to grow out of control, while not sacrificing quality customer service. It is a difficult balancing act." "Until just a few years ago, such fraud was considered a significant issue primarily for major banks with large branch networks centered in urban areas on both coasts," according to the report. "Today, bankers all across the country, in banks of every size, are feeling the impact of escalating criminal activity and the accompanying financial losses." While `traditional' fraud, like signature forgery, continues to be a threat, high tech fraud schemes are on the rise. For example, especially gifted criminals can produce counterfeit checks from their home computers or manipulate the ATM deposit available-balance policies. Findings in the report include increased investment by banks in deposit fraud risk management; upgraded quality of security directors and staffs; and increased executive involvement in setting prevention priorities, among other things. KPMG consultants conducted on-site interviews of fraud management teams at 17 banks of various sizes.