Question: It was my understanding that paper checks can only be processed and returned twice - that after the second time they cannot be presented for payment a third time. Someone mentioned that this may be changing to three times before presentment for pay/deposit is refused. Could you dispel or validate this?
Answer: We had a huge discussion on this last year at the workshop - fact is, there is evidently nothing anywhere that says you can only present a check twice. Those of us that have been around long enough to remember used to see a star stamped on the check by Fed when they were hand sorting. The star meant the check was going through for the second time and would not be accepted the third time around. Once automation started, that stopped. I've known checks that have gone through four and five times, so that it was impossible to read the back of the check anymore.
When I was still at the bank, we used to punch a hole in the account number on the MICR line the second time we returned a check so that it couldn't be put through again. Other than taking action like that, it would be impossible to stop the re-presentment any number of times, unless it was stopped by the teller at the window.
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