Prehaps one of you experts can help with this question. We recently had a customer insist on depositing a check payable to XXX Corpoartion (Yes, I made that up) to an account established in the name of ZZZ Corporation (Yes, I made this one up also). The customer is the single signer/officer on both corporations. Given the obvious reasons for not authorizing this transaction, I could not find anything in the UCC to support what I thought was a common restriction made by all banks. Can anyone give me direction to a statute, or other requirement that would support not accepting the deposit? Many thanks.

As long as a authorized representative of XXX endorsed the check and made it payable to ZZZ - there should be no problem. However, I would not have accepted it for deposit without it being properly endorsed over to the other company. There is no direct UCC citation, but you reserve the right to refuse any item for deposit. I would not be party to accounting shananigans.

I don't believe you'll find anything in the UCC or any other statue. It is really prudency and civil liability. You are correct to not authorize this. The check must be deposited to the account to which it was issued.

There are many posts and articles on BOL about tax evasion and how people tried to cash checks made out to businesses. I think this is the same thing.

I just read Randy's post (he beat me). I agree that if it was properly endorsed that you COULD accept these checks for deposits. But still, that is strange.

If I am the "single signer/officer" of both XXX Corporation and ZZZ Corporation, and I have the authority to endorse checks payable to XXX Corporation, what would be the reason that I could not endorse it as an officer of XXX Corporation and deposit it to the account of ZZZ Corporation? Or deposit it to the account of David Dickinson, for that matter?

Why would you do that? Tell me when you've seen that happen? Why would they want to NOT have the check go through the corporation?

Why? To evade taxes. To "cook the books."

Too many questions. No good answers.