We have some banker/client relationships where the client wants to mail to "their banker" checks to be deposited for them. Some of these are large checks. Sometimes the envelopes are addressed to the banker, sometimes just to the bank. When they are addressed to the bank, deposits are immediately made. If they are addressed to the banker, the admin's are still opening the check, but leaving them for the banker to handle. This process seems ripe for problems, but I always like to see what are the various issues, besides I don't like it. It seems to be there could be Reg CC issues and well as employee fraud/audit issues. For example, when is a deposit received by the bank when it is mailed in? When the envelope hits the bank, or when any employee knows its a deposit, or when the check actually makes it to the teller window? What happens when the banker is on vacation or sick for a week? Thanks for your input.

You are approaching this backwards. You first need to instruct customers to stop doing this unless the bank has a bank by mail program and if you do, you should then have pre-printed envelopes for the customers to use. Regardless, the first person to open an envelope with a check in it should be delivering it to whatever operations department is assigned to the task for disposition.

Thanks, but all of that is understood. I am trying to determine the legal/audit and compliance issues to force the above, if there is just cause. Just not liking something is not just cause necessarily. Any help?

229.19(a)(2) - Funds mailed to the depositary bank are considered deposited on the day they are received by the depositary bank;

Based on the above citation I would think you have a problem if deposits are received and then left for the "banker to handle". Assuming, like you stated, this could lead to a deposit sitting for an indefinite period until the banker is available to send the deposit on to the appropriate personnel. I think that elevates the concern you have from "not liking something".

What if the account goes overdrawn while the check is waiting for the banker to handle it - while he/she are on vacation?

Thanks Seeking! That's what I am seeking. I was also thinking about Reg Z and when payments are posted.

I would be more concerned with the Operational risks involved in this rather than regulatory.

If we have someone on vacation, unless it is marked personal, we open the mail for that very reason. We have customers (just a few) who will send a deposit or payment to an employee instead of just the bank. Since we do not have that many we know the customers names from the return address. Best practice is to contact customer and explain that it would be better to send to bank so that it can be taken care of in a timely manner. People get sick, quit and retire.