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#809588 - 09/05/07 08:13 PM Out dated Bank Checks
ktac MITCH Offline
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ktac MITCH
Joined: May 2005
Posts: 1,813
Giant side of TX
I would like some input on the following - PLEASE

Your bank has issued a check (payments / donations / etc)
After how long of the check not clearing do you consider it lost and attempt to issue a new check and/or when do you "write it off" and take the funds back ?

I am in Texas and the UCC 4-404 indicates no requirement for a bank to pay a check after 90 days, but can in good faith . . . what other considerations ? Thanks for the input.
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#809899 - 09/06/07 11:29 AM Re: Out dated Bank Checks ktac MITCH
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 77,026
Galveston, TX
After how long of the check not clearing do you consider it lost and attempt to issue a new check and/or when do you "write it off" and take the funds back ?

The answer is you can't take the funds back - they are escheated to the State of Texas after three years.
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#810078 - 09/06/07 02:37 PM Re: Out dated Bank Checks rlcarey
ktac MITCH Offline
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ktac MITCH
Joined: May 2005
Posts: 1,813
Giant side of TX
Thanks David. Let me be more specific.
I am trying to develop our policy/procedures for the time frame between 90 days and 3 years.
At what point do other banks try to contact the payee and reissue?
And as a practical point - if the check was for $1.03 that was remaining in a checking account intended to be closed, is there some way we can apply "setoff" and figure it would cost us $1.25 in forms, personnel time, postage, etc. and take the funds back?
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#810810 - 09/06/07 10:15 PM Re: Out dated Bank Checks ktac MITCH
ktac MITCH Offline
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ktac MITCH
Joined: May 2005
Posts: 1,813
Giant side of TX
Sorry Randy !
Checking my posts and noticed I said thanks David - - -
WOW I don't know where that came from.
Anyway, input from others on what your policy is for keeping your bank checks clean and up to date ?
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My opinions are just that, and might be worth what you paid for them.

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#810842 - 09/06/07 11:07 PM Re: Out dated Bank Checks ktac MITCH
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 77,026
Galveston, TX
Once the check has gone dormant, the State gets a little "upset" (tongue in cheek) concerning holders taking their money. They really don't care about the cost to the bank. Even on normal checking accounts you can't impose service charges after 1 year of inactivity. They want the money. I worked at one bank (not in Texas) that ignored the service charge requirements of the State and after they figured it out we wrote them a check in the mid 6 figure range.
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