M.D - someone intercepting and stealing your cheque is not your fault and shouldn't be your loss... the sponsor still hasn't paid *you*.
The long and short of it is that the sponsor probably can't be arsed to sort it out / go through their bank's fraud procedure, and so you're out of pocket.
Drop 'em ASAP. And tell us who they are.
(Just as a by the by, my bank manager told me he was loathe to accept US cheques because it's possible for a cheque to be returned unpaid after almost any length of time - it's never fully "cleared").
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