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#1433376 - 08/24/10 04:32 PM Cashing Checks made out to a business
rescue me Offline
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rescue me
Joined: Feb 2007
Posts: 102
Where can I find information the suggests checks made out to a business should be deposited to a business account and not cashed? I need some back bone to enforce the issue.

Thank you for any help!

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#1433390 - 08/24/10 04:45 PM Re: Cashing Checks made out to a business rescue me
Elwood P. Dowd Offline
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Next to Harvey
This is one of those "expired equine" topics that used to fill the threads, but hopefully the practice is near extinction. Here's an old post from John that will put you in position to compile your own response from previous threads:

This question, or something very much like it, has been discussed scores of times on BOL Threads. Click the "Search" link above and search for "+cashing +checks +business" (leave out the quotes), and you'll find a bunch (along with some about check cashing businesses). Here's one of them.
on.
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#1433423 - 08/24/10 05:15 PM Re: Cashing Checks made out to a business Elwood P. Dowd
Doug Hendrickson Offline
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#1459457 - 10/26/10 02:35 PM Re: Cashing Checks made out to a business Elwood P. Dowd
GottaLuvIt Offline
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Joined: May 2009
Posts: 48
Ugh...happen to be looking for the same information...having no luck with the search..Any suggestions?

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#1459596 - 10/26/10 05:14 PM Re: Cashing Checks made out to a business GottaLuvIt
madukes Offline
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madukes
Joined: Jul 2009
Posts: 1,448
Flyers Country
We were always told that checks payable to a business must be deposited to a business account and not cashed. The main reasoning was probable tax evasion on the money and audit issues. Also, if you have a check payable to ABC Co. and John Smith wants to cash it, do you have an account titled ABC with appropriate paperwork (i.e. corporate resolutions, sig cards, etc) that would indicate that he is authorized to act on behalf of the company? We have a situtation going on now - a customer is depositing checks payable to a leasing company to his personal account. We do not have any accounts titled for the leasing company ("Smith Leasing" - he is Smith) but at the same time he is collecting unemployment benefits from the state. He does have a differently titled business account at the same branch that has been overdrawn for over a month. the tellers allowed him to deposit a check payable to this business to his personal account as well. Our Security Dept has been monitoring the accounts.

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#1459598 - 10/26/10 05:18 PM Re: Cashing Checks made out to a business GottaLuvIt
GottaLuvIt Offline
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Joined: May 2009
Posts: 48
obviously wasn't holding my mouth correctly while i searched (HaHa) found numeroooous threads. thanks!

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#1459617 - 10/26/10 05:27 PM Re: Cashing Checks made out to a business GottaLuvIt
Kathleen O. Blanchard Offline

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Also, if you do an advanced google search, searching the forums as the domain, you can play with the search terms and will find a lot of information.
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#1460941 - 10/28/10 06:36 PM Re: Cashing Checks made out to a business Kathleen O. Blanchard
MyBrainHurts Offline
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Joined: Feb 2010
Posts: 960
Illinois
I think this is an excellent thread on the topic:

http://www.bankersonline.com/forum/ubbthreads.php?ubb=showflat&Number=729033

John, Al and Ken all make good points. I've been with this bank for less than a year and I stopped the cashing of sole proprietor checks. Thread 729033 helped me clarify my reasons why. I didn't want to say, "Because that's the way I learned it."
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#1461420 - 10/29/10 04:20 PM Re: Cashing Checks made out to a business MyBrainHurts
John Burnett Online
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I didn't include it in the thread that KFitz linked, but I will add it here -- Much of the problem, I think, can be eliminated by setting appropriate customer expectations -- up front.

Set up a simple "we don't cash checks payable to a business and we won't give businesses cash back on deposited checks" policy and apply it across the board, including sole proprietorships. Then, at account opening of every business account, make sure that point is explained. Reinforce it, if necessary, by backing up your tellers when they "just say no" to customers who want them to make an exception. If you have a customer newsletter that goes out to business accounts, add a short article (make it a user-friendly Q&A if you want) about the policy.

If you set customers' expectations early, you won't get as much push-back later.
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#1461475 - 10/29/10 05:15 PM Re: Cashing Checks made out to a business John Burnett
Elwood P. Dowd Offline
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Next to Harvey
I had this call yesterday from a very competent banker who is trying to defend the decision against, of all people, "management." My summary observation was that your bank could do this for decades and (in the process) help people commit everything from income tax evasion to embezzlement, yet, never have a problem. Or, you could get sued tomorrow.

The only real guarantee is that if you get sued you will lose. You will lose because you deserve to lose.
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