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#2258870 - 08/27/21 06:22 PM Strange Endorsement
Tanders922 Offline
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Joined: Sep 2015
Posts: 112
In reviewing some procedures I discovered a unique/strange endorsement. Instead of voiding/issuing a stop payment on a check that was written out of our DDA that goes uncashed, they are endorsing the check as, "not used for purpose intended". This does not seem permissible to me.

Any thoughts on this endorsement?

Thanks!

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#2258873 - 08/27/21 06:39 PM Re: Strange Endorsement Tanders922
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 77,216
Galveston, TX
If the bank issued a check that was not used - what difference does it make? Why does it require an endorsement at all.
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#2258884 - 08/27/21 07:57 PM Re: Strange Endorsement Tanders922
Tanders922 Offline
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Joined: Sep 2015
Posts: 112
I agree that the endorsement was unnecessary.

Thanks!

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#2258923 - 08/30/21 04:11 PM Re: Strange Endorsement Tanders922
Susielou Offline
Gold Star
Joined: Aug 2005
Posts: 323
Midwest
We use the stamp "not used for purpose intended" when a customer purchases a cashier's check to purchase something and then brings it back because it wasn't used.

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#2258938 - 08/30/21 05:31 PM Re: Strange Endorsement Tanders922
John Burnett Offline
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John Burnett
Joined: Oct 2000
Posts: 39,333
Cape Cod
It explains why the original check is back in the bank's hands, without an indorsement.
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#2259094 - 09/01/21 03:51 PM Re: Strange Endorsement Tanders922
John Burnett Offline
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John Burnett
Joined: Oct 2000
Posts: 39,333
Cape Cod
I'll add the fact that this practice has existed for decades. In some cases, the issuing bank has the purchaser add the indorsement, and signing it. Other banks use a rubber stamp. Some will use the check (with this "strange indorsement") as a debit to credit the amount back to the purchaser's account.
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#2259105 - 09/01/21 05:58 PM Re: Strange Endorsement Tanders922
madukes Offline
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madukes
Joined: Jul 2009
Posts: 1,448
Flyers Country
That endorsement has been used for ages for items such as cashier's checks and money orders. Voiding your own check just means it is never paid; a cashier's check or money order are funds already taken from you via debit or handing over cash. if you void it you are still out the money. The easiest way to get your money back if you no longer need the instrument is to endorse it "not used for purpose intended" and deposit the check back to your own account.
Last edited by madukes; 09/01/21 06:00 PM.
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