Can we place a seven day exception hold on a check and list the following reason:

"We believe a check you deposited will not be paid for the following reason: check is drawn on a canadian bank."

Doesn't seem to fit the true exception reasons to me, but thought I'd check with BOL.

I agree, not a valid reason. You could refuse as a deposit item and accept for collection.

If it is drawn on a Canadian bank, 7 days is not going to do you any good. I have seen them take a month to come back. If you don't trust the check or the depositor, send it for collection only.

I have also seen checks from Canada take longer than 7 days. I would send for collection and credit account once you have your credit.

I am a new banker. How does the collection process work?

This thread may shed some light on the topic:

Check Collection

Hello! If the check is drawn on a Canadian bank, it's not covered by Reg CC.

What makes you say this? How do you know....is this stated in the Regulation somewhere?

I've always presumed, perhaps incorrectly, that the check had to have been issued by a bank in one of the 12 federal reserve districts for this regulation to apply. This was how we, in the past, determined if a check was local or non-local. If it wasn't issued by a bank in one of the fed districts, it was neither local nor non-local, and therefor not subject to the regulation.

Correct Doug. It's not something that is expressly stated in the regs, you have to back into it. Look at the definition of a CHECK, then look at the definition of a BANK.

(k) Check means--
(1) A negotiable demand draft drawn on or payable through or at an office of a bank;
(2) A negotiable demand draft drawn on a Federal Reserve Bank or a Federal Home Loan Bank;
(3) A negotiable demand draft drawn on the Treasury of the United States;

(e) Bank means-- For purposes of subparts C of this part and, in connection therewith, this subpart A, the term bank also includes any person engaged in the business of banking, as well as a Federal Reserve Bank, a Federal Home Loan Bank, and a state or unit of general local government to the extent that the state or unit of general local government acts as a paying bank.

(1) An insured bank as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 18I3) or a bank that is eligible to apply to become an insured bank under section 5 of that Act (12 U.S.C. 1815);
(2) A mutual savings bank as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813);
(3) A savings bank as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813);
(4) An insured credit union as defined in section 101 of the Federal Credit Union Act (12 U.S.C. 1752) or a credit union that is eligible to make application to become an insured credit union under section 201 of that Act (12 U.S.C. 1781);
(5) A member as defined in section 2 of the Federal Home Loan Bank Act (12 U.S.C. 1422);
(6) A savings association as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813) that is an insured depository institution as defined in section 3 of that Act (12 U.S.C. 1813(c)(2)) or that is eligible to apply to become an insured depository institution under section 5 of that Act (12 U.S.C. 1815); or
(7) An agency or a branch of a foreign bank as defined in section l(b) of the International Banking Act (12 U.S.C. 3101).

IMHO, nothing is mentioned about Canada or anything outside of the country.