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#1998580 - 02/26/15 09:59 PM Depositing personal checks to a business account
Mocha's Mom Offline
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Mocha's Mom
Joined: Jun 2004
Posts: 633
Western MA
Hello everyone. I tried a search but was unsuccessful and I am sure this has been asked before so I apologize.

Here is the scenario: Person who is an authorized signer on a business account for a corporation deposits the check to the business account. No one else from the corp endorses the check nor is it endorsed over to the business for deposit. My opinion is the check should not be deposited to the business account as the business has not accepted the check nor the responsibility for the check. I don't believe we would have right of setoff in this circumstance as the check has not been properly endorsed. Can someone please clear this up for me? Thank you

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#1998654 - 02/27/15 02:30 PM Re: Depositing personal checks to a business account Mocha's Mom
Elwood P. Dowd Offline
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Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
Agreed; the mistake lies with the teller who accepted it for deposit without proper endorsement.
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#1998891 - 02/27/15 07:23 PM Re: Depositing personal checks to a business account Elwood P. Dowd
Mocha's Mom Offline
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Mocha's Mom
Joined: Jun 2004
Posts: 633
Western MA
Thank you, Ken, I appreciate it!

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#2001571 - 03/13/15 04:49 PM Re: Depositing personal checks to a business account Mocha's Mom
bcompliance Offline
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Joined: Sep 2014
Posts: 1,258
We had a customer come in with a tax refund check made out to her brother and sister in law. The check was marked for deposit only and not signed. It was deposited into an account for the sister and brother, and wanted cash back. The teller deposited the check, gave cash back to the customer-who was not on the check. We never processed the check and recovered the money. Besides excessive training for the teller involved in this scenario does anyone have any suggestions?

Also does anyone have noncompliance articles or penalties that can be assessed for this activity? There seems to be little consequences for employees and I'm trying to hand them something in the training that will make them realize this is a very serious matter.
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#2001619 - 03/13/15 06:40 PM Re: Depositing personal checks to a business account Mocha's Mom
bcompliance Offline
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Joined: Sep 2014
Posts: 1,258
I should have mentioned that the account this was deposited into was a business (farm) account.
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#2001692 - 03/13/15 09:22 PM Re: Depositing personal checks to a business account Mocha's Mom
David Dickinson Offline
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David Dickinson
Joined: Nov 2000
Posts: 18,762
Central City, NE
1st - the check was marked "deposit only". The check was deposited. Everything's good so far. But the customer then took a cash withdrawal from the account. Is this customer authorized to withdraw from this account?

Anyone can deposit a check into my account, but no one is authorized to withdraw from my account except me. If someone were to do so, I sue the bank. The teller needs to understand the seriousness of the their responsibilities. Account signature cards/corporation resolutions need to be checked to ensure that the person in front of them is authorized to conduct the transaction in which they request. If not and the teller does so anyway, the bank is liable.

I don't believed there's any compliance penalties. The bank is simply on the hook for all of the money that was distributed without authorization and legal fees if sued for this transaction.

I don't think it matters that this is a business account or consumer account. The authorization levels and bank responsibility is the same.
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http://www.bankerscompliance.com

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#2001747 - 03/16/15 12:54 PM Re: Depositing personal checks to a business account Mocha's Mom
bcompliance Offline
Diamond Poster
Joined: Sep 2014
Posts: 1,258
Thanks for your response David. Very helpful as always!
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