Fraudulent Items

by Barbara Hurst, BOL GuruGuru Bios

Question: We received in our exchange this morning four items that were deposited here two months ago. They're stamped, in red ink, "Fraudulent Items" and were charged back to us through the Fed. Can I refuse these as late returns and send them back via the Fed?

Answer: You sure can - and should. If they were deposited two months ago, they should be coming back to you without entry, through the United States mail. And even then, they more than likely are not your problem, though it appears the drawee bank is attempting to make it your problem. As long as the transit numbers are correct and the items have not been kicking around a Federal Reserve Bank for a couple of months, you have every right to refuse them. If, however, the fault lies with the Fed, you could have a larger problem. Fed does not accept responsibility for mis-routed items, even if they mis-routed them. Make sure the other bank was the originator of the return that late. The dates on the back of the items will track that for you.

What you should also do is immediately take a look at your account the checks went into. Fraudulent items going into your account could mean you've got a bad customer too. Do some instant research and investigation.

Copyright © 2004 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 14, No. 07, 10/04