We had a customer deposit a check drawn on Bank of America for $1500. Bank of America sent us a letter stating that the check was supposed to be for $500 and that the check was altered so now we owe them $1000. It is our fault for the teller not noticing the obvious alteration, but can we go after the customer for the $1000? Also, can we suspend or put a hold on their account until we receive the $1000?

You are well within your rights to pursue your customer. Many institutions will simply debit the thief's account for the $1,000 to collect whatever funds are remaining in the account have overdraw it by the difference. Then any additional deposits to the account will first be applied to what is owed the bank. If the funds are not repaid, pursue whatever collection efforts you normally would. If the account ever reaches a positive balance before it has to be charged off, you may want to send this customer a letter at that time saying that you will be terminating the account. (Why leave them in position to put you at additional risk.) Another suggestion is to review recent deposits to see if you have any additional liability risks from this type of activity.