Account Signature Removal
Question: I know you've always taught not to take names off of accounts, but we have a company that uses a joint account for petty cash. It has two individuals as signers. One is leaving the company, and has given us a letter saying they have no more interest, etc - a sort of hold harmless letter from the company and they want to add and take off a signer. Can we do that without getting in trouble? They just don't want to have to pay for another check order on a new account.
Answer: The "joint account" sort of threw me, until I learned that the account has the TIN of the corporation. You don't need the letter of indemnity, but you do need a new resolution for the account signed by the secretary of the corporation naming the signers on the account. That makes it easy to change signers without getting new check orders.
Copyright © 2004 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 14, No. 07, 10/04
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