|
|
|
US Treasury Check Endorsement Issue
by John Burnett, BOL Guru
Guru Bio
Question: Must US Treasury checks be endorsed, or can they just be stamped with our generic "credited to the account of the within named payee"? My question comes from a situation with a customer who comes with these checks made out to her husband for another person (Joe Smith for Suzy Doe). She deposits them into the joint account with no endorsement of any kind.
Answer: If Suzy Doe's interests are not being served by Joe Smith, which is to say that he's diverting her money to his own use, or if Suzy's heirs question what happened with her benefit payments, the bank could be in a sticky position. Joe's fiduciary relationship to Suzy is evident on the face of these checks. The fact that the checks are being deposited to Joe and his wife's joint account could put the bank legally on notice of a breach of Joe's fiduciary duties to Suzy if an interested party goes after Joe or his wife for misappropriating those funds. If the bank is found to be on notice of that breach the bank can be found liable for some of the compromised funds. The fact that the check isn't manually endorsed isn't a problem in itself. The fact that it's being deposited into the wrong account is what is likely to raise problems.
First published on BankersOnline.com 3/19/07
Privacy Policy Disclaimer Recommend This Site ! Contact Us
BankersOnline is a free service made possible by the generous support of our advertisers and sponsors. Advertisers and sponsors are not responsible for site content. Please help us keep BankersOnline FREE to all banking professionals. Support our advertisers and sponsors by clicking through to learn more about their products and services.
|
|
|
|
Print Friendly!
Email This Article!
Discuss NOW!