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Exception Hold on Available Funds?
by Jim Bedsole, BOL Guru
Guru Bio
Question: Can we still place an exception hold based on reasonable doubt of collectibility if we have called and verified the funds and the bank states that the funds are available today? If so, what exception rule would you apply?
Answer: There are six categories of exception holds you can place, if the circumstances allow. These six are:
- New account
- Large deposit
- Repeat overdrafter
- Redeposited item
- Reasonable cause to doubt collectibility
- Emergency conditions
If the conditions for any of these apply, you can use that exception hold reason. Under #5, there could be any number of specific factors that give rise to the reasonable cause to doubt colletibility beyond those that would be confirmed through a call to the bank. For example, it could appear that there have been alterations on the face of the check or to the endorsement, the check could be a counterfeit or you might suspect that the signature is forged. The key is that you can't just have a hunch, you've got to have specific facts that rise to the level of reasonable doubt about that check. If none of the six exception hold reasons are available, you can still place a case-by-case hold on the item. This type of hold, while for a shorter period of time, does not require a specific reason for placing the hold.
First published on BankersOnline.com 4/14/08
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