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#78540 - 05/07/03 12:06 AM Depositor Notice
Suzie Offline
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Suzie
Joined: Apr 2002
Posts: 662
Far North
Hello:
I sure could use some help on this as my research skills have drawn a blank. How soon must the bank send notice to a depositor in the following circumstances: NSF presentation against their account? ACH return? Return of item deposited to their account?
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General Discussion
#78541 - 05/07/03 12:17 AM Re: Depositor Notice
Andy_Z Offline
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Andy_Z
Joined: Oct 2000
Posts: 27,503
On the Net
I don't know about the ACH, but I don't believe that there are requirements for the NSF or returned item at all. They are certainly positive for customer service, but are not Federal requirements that I know of. We searched on NSFs in the past and saw that it may reduce your liability (due to delayed Reg. E claims) but is not a required notice.

Not required = no time frame.
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#78542 - 05/07/03 12:25 AM Re: Depositor Notice
Suzie Offline
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Suzie
Joined: Apr 2002
Posts: 662
Far North
Thanks Andy! So that is why I could not find anything! Under 205.9 statements are covered but that was all I could come up with.
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"Whales get harpooned because they surface to spout."

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#78543 - 05/07/03 01:40 AM Re: Depositor Notice
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 79,653
Galveston, TX
Regarding notice of a returned item deposited to their account, you do have a responsibility and possible liability under Reg CC 229.33(d):

(d) Notification to customer. If the depositary bank receives a returned check or notice of nonpayment, it shall send notice to its customer of the facts by midnight of the banking day following the banking day on which it received the returned check or notice, or within a longer reasonable time.

Basically, if they suffer a loss due to untimely notice, they could try to hold the bank responsible. This is why if you automatically represent returned items a second or third time for a customer you are wise to have a hold harmless agreement in place for delayed notification.

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