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Cashiers Checks Safe?
ChrisRx
Posts: 5,619 ✭✭✭✭
I admit I have never delt with one before. How long should I wait until I know the funds are "good?"
I found the following on wiki:
"Most banks do not clear them instantly. However, banks are permitted to take back money from a "cleared" check one or two weeks later if subsequent processing finds it to be fraudulent. Because customers believe the checks have been found valid and have been converted to cash in hand, customers are readily defrauded by schemes that ask them to part with goods or a portion of the money if it is cleared in a timely manner."
That kind of scared me. Any recommendations?
I found the following on wiki:
"Most banks do not clear them instantly. However, banks are permitted to take back money from a "cleared" check one or two weeks later if subsequent processing finds it to be fraudulent. Because customers believe the checks have been found valid and have been converted to cash in hand, customers are readily defrauded by schemes that ask them to part with goods or a portion of the money if it is cleared in a timely manner."
That kind of scared me. Any recommendations?
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What bank is the check from? Is the bank in your state? Take it to that Bank it was drawn on and cash it if you can. Yes, banks nowadays charge a $5 fee or so for doing this (used to be free...the whole reason for banks is to keep accounts and cash their checks originally).
Otherwise, in 1 day it should clear your bank. But you can ask your branch manger what their policies are. Yes, if it's "bad" it may take a few days to turn up.
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I'd request a wire transfer instead if it's high dollar amount. Can't reverse those.
If you're worried about giving out your account numbers, you can setup a new account just for the wire transfer.
Always a good idea if the check is from someone you don't know or even someone you do!
There was a big scam in NZ a few years back with a fraudulent cashier's check. Took a coin dealer for $140,000.
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<< <i>Cashiers checks are supposed to be guaranteed funds. >>
Cashiers Checks are easily counterfeited. Fortunately a good bank would spot it right away.
Never, ever, drop deposit or mail deposit a Cashiers Check thinking you've received payment. The bank MUST see the check. Abd let the bank do the validating since they know who to call and what to ask.
The name is LEE!
<< <i>It can also happen with wired funds. >>
Upon request my credit union creates a new temporary account to accept wired funds. As soon as funds appear I transfer them to my permanent account and close the temporary account. Credit Union suggested to do this to protect myself from fraud.
Government is the great fiction through which everybody endeavors to live at the expense of everybody else. - Bastiat
So even if the funds are good, how long should I wait? And can the "good funds" be credited back to his account at any time, or is there a time frame when he can't do that?
<< <i>Thanks for all the replies. It is a cashiers check from a bank that I bank at. >>
If the check is written on your bank, there should be no delay as they can simply look at the check and know it's guaranteed funds.
Talk with the manager or person in charge when you take it in. There should be no issues since it's written on your bank but always confirm this with management before assuming anything.
Never rely on the word of a teller, clerk, or receptionist.
<< <i>Thanks guys. I will check with my bank about their policies on cashiers checks. >>
I found this partial artical on line a few days ago, If I can find it again Ill post it all..
Tragically, the scam works partly because of common misunderstandings about how banks clear checks. Financial institutions are required by federal law to give you credit for checks deposited in your account within a set number of days. The precise timing depends on whether the check issuer is local, national or international. Most consumers assume that when the bank makes the funds available, it has determined that the check is good. But that's not the case.
It can take weeks to discover a good forgery. At that point, the bank will reverse the credit it gave you for the fake check and you're on the hook for any checks you wrote against it. Worse, many banks will consider you the crook, close your account for "suspicious activity" and enter your name into a database that will make it more difficult to open another bank account, says Grant.
<< <i>I admit I have never delt with one before. How long should I wait until I know the funds are "good?"
I found the following on wiki:
"Most banks do not clear them instantly. However, banks are permitted to take back money from a "cleared" check one or two weeks later if subsequent processing finds it to be fraudulent. Because customers believe the checks have been found valid and have been converted to cash in hand, customers are readily defrauded by schemes that ask them to part with goods or a portion of the money if it is cleared in a timely manner."
That kind of scared me. Any recommendations? >>
I would rather take a personal check rather than a cashier's check. I have known of several instances where a cashier's check came back no good after two months. For a very large transaction, go with a bank wire.
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<< <i>Take it to that Bank it was drawn on and cash it if you can. Yes, banks nowadays charge a $5 fee or so for doing this >>
That's what I would try. Tell them you're a bank customer but you don't want it cashed or deposited against your account, you just want it cashed and it's from their bank. See what they say.
<< <i>There are counterfeit, stolen or otherwise false cashiers checks out there. Simply depositing one is no guarantee that it will clear. >>
I learned that the sort of hard way, deposited one fpr $20K and it bounced - but not because there weren't funds in the account - but because it had not been properly prepared when it was made out in the bank. I got the money quickly, but after that I always called the issuing institution to verify that the cheque had indeed been issued - the funds were available and that it had been properly signed etc.
Banks have no incentive to spot them at the window. They make money off NSF and other bad checks by charging the depositor.
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<< <i>Take it to that Bank it was drawn on and cash it if you can. Yes, banks nowadays charge a $5 fee or so for doing this >>
That's what I would try. Tell them you're a bank customer but you don't want it cashed or deposited against your account, you just want it cashed and it's from their bank. See what they say. >>
I don't believe it cashes against your account unless you deposit all or part of it.