Check "clearing" for the nth time

[j-c-c-62]

"“By law, banks have to make deposited funds available quickly,” the FTC says. “Even if you see the funds in your account, that doesn’t mean it’s a good check.”

MSN

 

[68-500]

My bank told me if I have enough money in my account to cover the check Im depositing the funds are available immediately. If not they put a hold on it until it clears the issuing bank.

 

[WileE]

Good post and good article. I know a few people who've been scammed.

 

[WileE]

My bank told me if I have enough money in my account to cover the check Im depositing the funds are available immediately. If not they put a hold on it until it clears the issuing bank.

Yeah, but when the check bounces, you find out you got ZIlCH. You're taking out your OWN money at that time, until the check clears.

 

[YY1]

What I want to know is-

WTF is up with banks refusing to cash checks drawn on accounts at their institution, unless you also have an account there?

IMO, that should be federally illegal.

 

[WileE]

What I want to know is-

WTF is up with banks refusing to cash checks drawn on accounts at their institution, unless you also have an account there?

IMO, that should be federally illegal.

The check could be fake, and the person/business may not have actually issued the check. Example: I go to YOUR bank with a check drawn on YOUR account for say, $2,000. They give me cash. Check is discovered to be fraudulent, or YOU see your statement at the end of the month showing THAT check that YOU did not write debited from your balance.

 

[YY1]

The check could be fake, and the person/business may not have actually issued the check. Example: I go to YOUR bank with a check drawn on YOUR account for say, $2,000. They give me cash. Check is discovered to be fraudulent, or YOU see your statement at the end of the month showing THAT check that YOU did not write debited from your balance.

The institution in question should be the best possible place to verify the authenticity of a document drawn on them.

Who else should be "on the hook" for that?

 

[Don selleck]

What I want to know is-

WTF is up with banks refusing to cash checks drawn on accounts at their institution, unless you also have an account there?

IMO, that should be federally illegal.

tax evasion, anything over 10k, in a month period triggers a CTR cash transaction report, that is sent to the IRS. they usually charge a fee if you don't have an account, they want a cut too. My wife worked as a banker for 20 years.

 

[YY1]

What does that have to do with cashing a check at the institution it is drawn on?

 

[Unkle Krusty]

Often it is the independent agent who spends hours being lectured about money laundering. And the rules we need to follow. When in fact it is the big outfits doing it. Banks, casinos, and others.

 

[Richard Cranium]

Wire transfer or cash.

 

[j-c-c-62]

What detail here that is crucial is, today, not like years ago, ANY check, at ANY time, can be returned.
Let that sink in.
No check "clears", funds do become available, but that does not mean "clearing".

The crooks are taking advantage of the time delay, and the banks are in no hurry because they have an unlimited amount of time to return ANY check.

And banks are not legally required to cash a non-account holders check, as they have no financial recourse if they do.

 

[YY1]

I just want a check from Bob Smith, drawn on USB bank, to be cashed at a USB bank office without the need for me to have a USB bank account.

I don't car if it's for $5, or $15,000.

 

[68-500]

Yeah, but when the check bounces, you find out you got ZIlCH. You're taking out your OWN money at that time, until the check clears.

Yes.

 

[Don selleck]

What does that have to do with cashing a check at the institution it is drawn on?

its a reason for them to not do it, just like it says.

 

[YY1]

So, by not cashing checks drawn on their institution, they are forcing my bank, or even me personally to "hold the bag" for any fraudulent checks and/or any returned check fees.

I'll reiterate- this should be federally illegal.

 

[j-c-c-62]

I just want a check from Bob Smith, drawn on USB bank, to be cashed at a USB bank office without the need for me to have a USB bank account.

I don't car if it's for $5, or $15,000.

Your desire is reasonable and understandable, but as others have noted, it requires the bank to take a financial risk, and since there is no real obvious reward here for them taking that risk, they aren't going to take it.
As mentioned by another here, there is no certain way a bank teller can determine if a presented check is real, forged, etc while a person at the window waits, although all they can do is determine if there are funds "available" at the moment in the account shown on the account. Mere minutes later those funds could change by other incoming debits being posted.

 

[YY1]

there is no certain way a bank teller can determine if a presented check is real, forged, etc

Why is that?
That needs to be fixed.

 

[YY1]

Your desire is reasonable and understandable, but as others have noted, it requires the bank to take a financial risk, and since there is no real obvious reward here for them taking that risk, they aren't going to take it.

Further...

they are already reaping the "reward" of having the person they have given an account to deposit money in their care, for them to use until that client needs it.

 

[j-c-c-62]

Why is that?
That needs to be fixed.

Determining a real forgery takes training and expertise beyond a mere cashier.
Determining validity of the check as written can only be partially done by phone with account holder, and that confirmation is not very legally binding.
Determining the validity of the check itself requires full knowledge of all the secret and often hidden features of the check and likely magnification to verify them as authentic.
All this is time consuming for the bank and still fraught with risk, vs the "normal" way of depositing a check and let it run thru the system and normal channels with no time constraints.
Understand, I am not in favor of this system, but I do my best to make sure everyone understands its pitfalls, which I think separates me largely from the banks who are not very forthcoming, it seems intentionally.