If an on-us check is presented at the teller window, what are the proper requirements? Does the check need to be stamped NSF by the teller or does it only get stamped NSF after it is processed thru the system?

If the funds are not on deposit or available when the check is presented at the teller window, why would you honor the check?

If we are not going to pay the check based on the NSF balance, we instruct our tellers to stamp the check NSF, so that the holder can take whatever action they feel necessary. At least they have the stamp on the check instead of just being told verbally.

We usually tell the individual cashing the check to come back later and don't take any action.

Depends how the customer asked...if they just wanted to know if there were sufficient funds, we would tell them. If they wanted to cash the check and presented it to us, we would stamp NSF and hand bac to them. Customer's account would also be charged for an OD, and if the presentor had an account with us, we would chrge them the $3.00 fee for presenting a NSF item...

We would tell the presenter that the check is not payable at this time. As we have not told them if is a stop payment, NSF, or other reason for non-payment, it keeps us "safe" from any privacy issues.

happygilmore - out of curiosity, if the item never makes it past the teller how can you justify charging the the customer $3 for simply attempting to cash a check? Aside from the 4 seconds it took for the teller to determine the funds are not available the transaction cost you nothing.

As indicated by your respondents to date, it's a matter of policy and policies vary. First, some instruct tellers to seek the input of a supervisor who might be willing to approve taking the account overdrawn or the parameters of any ODP plan affecting the customer's account. If the overdraft is approved, the payee never knew about the problem and the customer is charged an NSF fee. However, if the decision is made not to pay the check, some banks automatically stamp the item "NSF." Some apply the stamp only if the payee requests it. Others will not apply the stamp regardless of what the payee wants.

If the item is not stamped there is no evidence that it was ever presented and the payee cannot take action on it. If a payee requests that the item be stamped, you can rest assured that this is not his first rodeo.

As for charging the drawer a fee for an NSF item at the window instead of through the clearing system, sure. It took a teller's, and perhaps a supervisor's, time and the decision had to be handled manually rather than via the automated methods used in the backroom. That may not be worth a $22 NSF fee, but the fact that it required a manual handling and decision making process makes it far easier to rationalize than the same fee charged for a backroom decision that was totally automated.

As an NSF item presented at the window will not appear on the customer's statement, a debit entry used to charge a fee should describe the check fully.

Milby - first, how would telling a customer that an item is either NSF or stop payment be protecting privacy? If this item was presented under normal payment channels, you would stamp this on the check. I think your bank is reading too much in to this. They already have the account information on the check (account number, name, possibly address, phone, and even ssn), so I don't understand the protectinbg privacy standpoint. They are not asking for account balance, just that the item be paid. If I was a wily attorney (which I'm not, and I don't play one on TV or in BOL), I could certainly see that you've taken on liability by failing to follow presentment point guidelines.

From our standpoint, we treat an item on the teller line the same as we treat an item received via a cash letter, it was presented for payment, and we need to take the appropriate steps to protect our bank from liability. If I just hand it back to my customer without taking action, I open myself to liability down the road. We treat the teller as a point of presentment, as defined by Reg CC. We have never had a customer complain about he $3.00.

That's an interesting point... I had assumed that sec 229.36 applied only to a bank submitting a check for payment (i.e. through a cash letter), not a consumer bringing the check to an office for payment. Thanks for the insight.

Our customer base must be quite different...I think we would have a riot if we charged $3!

Just had a converation about this topic today with back-room ops and thought I would get your input.

Customer A comes into branch at 11:00am and deposits a check into his account (assume no hold). Proof department is off-site and the bank does not live-post tranactions, so the item will not credit until 4:00pm.

Customer B presents an on-us check from Customer A for payment at the teller line at 11:30am. Customer A's account doesn't have the funds available to cash it, so the teller stamps the check NSF and returns it to Customer B.

As credits to the account are to post to the account before debits for that busines day, is there not a problem with the bank for returning the check "NSF" before verifying the credit transactions in process?

I don't think so. When Customer B presented the check the funds were not in the account. Also, your bank gives (I'm assuming) 'next-day' availability - right?