Internal Control Question - checks received as payment

Let's say XYZ company receives checks in the mail made out to "XYZ Company" for products or services it sells, etc.
The checks are held at the company until physical deposits at the bank are made 2 or 3 times a week.   Disregard the possibility of electronic deposit or matching the checks against sales orders, invoices, etc.

My question is whether anything fraudulent can be done with those checks by a corrupt employee such as depositing one or more of them in their own account (even though the checks are made out to "XYZ Company").

When a company holds checks for an extended period of time, yes it increases the risk of loss or destruction (in case the building burns down, etc), so you want to get those checks in the bank ASAP.   But what I'm wondering is if someone is able to do something (to enrich themselves for example) with checks made out to a company.  Thank you.
dbfromnewjerseyAsked:
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Thibault St john Cholmondeley-ffeatherstonehaugh the 2ndCommented:
I can imagine the name on the cheque could be tampered with. Perhaps a false account opened with a similar name to the company.
'Mr Crosoft'. But I can't work out how to extract money from that account for personal gain without it being traceable. Someone with criminal intent may have ways of laundering such accounts but I have no idea how that works.

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Juan OcasioApplication DeveloperCommented:
Also, it would be dependent of the the bank making the deposit.  If they're not diligent, and notice the name is a company name and not the individual, they may go ahead and deposit the cheque.  I would suspect, however, that if you are waiting for a payment that a customer has already made, they will investigate and track down where the cheque was deposited.
David Johnson, CD, MVPOwnerCommented:
My question is whether anything fraudulent can be done with those checks by a corrupt employee such as depositing one or more of them in their own account (even though the checks are made out to "XYZ Company"). it is the depositing banks responsibility to check that the name on the check matches the account. I've had to get checks reissued that spelt my last name as "Johnston"

Even the attempting  this the person is open to
charge 1 : abuse of trust
charge 2-xxx : attempted fraud under $5000 for each cheque under $5000
 (one count for each cheque)
charge 3-xxx: attempted fraud over $5000 for each cheque over $5000 (one count for each cheque)

The bank is responsible for making good the error. Cheques unlike cash leave a very large paper trail.
David Johnson, CD, MVPOwnerCommented:
best practice is on receipt of a cheque to stamp the back of the cheque.
For Deposit only to account XXXX
dbfromnewjerseyAuthor Commented:
Thank you
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