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#1922123 - 05/12/14 03:14 PM Reason to Doubt Collectability
Rosie O'Grady Offline
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Rosie O'Grady
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California
Question, how are you all complying with Reg CC when you have a confidential reason to place a hold? Obviously all you can tell the customer is that the reason for the hold is "confidential information", yet the reg requires you to maintain documentation for the hold up to 2 years. How are you documenting your reason, e.g writing the reason, e.g. Kiting, on a copy of the receipt or ?????

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#1922449 - 05/13/14 11:35 AM Re: Reason to Doubt Collectability Rosie O'Grady
Elwood P. Dowd Offline
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Elwood P. Dowd
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Next to Harvey
Generally, hold notices are two part forms. As the bank is actually required to keep a copy of a hold notice for reasonable cause to doubt collectibility as well as a written explanation of the circumstances, many banks write the explanation on the back of their copy of the hold notice.
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#1940404 - 07/14/14 03:48 PM Re: Reason to Doubt Collectability Rosie O'Grady
Soccer Offline
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We have recently had a spike in the amount of fraudulent checks being deposited and returned. Branch Administration would like to place a blanket statement in our policy & procedures that all out of state checks be held for Reasonable Cause. I say no because it is selecting a class of checks which the reg says is a no no. Now if an account has a daily average balance of 20.00 and they want to deposit an out of state check for 2,000.00 to me that would be reasonable cause.. We would then document the proof and hold within the regulation guidelines. Would this be acceptable?
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#1940414 - 07/14/14 04:15 PM Re: Reason to Doubt Collectability Rosie O'Grady
Skittles Online
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TN
I'm sorry but the balance of the account and the amount of the check do not equal 'reasonable cause'. There has to be something specific. Remember - reasonable cause means there is something that would give the average person a reason to question the validity of the check. The amount or where it is drawn do not do that.
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#1940418 - 07/14/14 04:21 PM Re: Reason to Doubt Collectability Skittles
Doug Hendrickson Offline
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Doug Hendrickson
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I agree with Skittles. I would apply this on a case-by-case basis.

If this customer had a history of returned checks, and this check was drawn on the account of those other returned checks, then I'd say you had reasonable cause.

You can always refuse to accept the check for deposit.
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#1940420 - 07/14/14 04:23 PM Re: Reason to Doubt Collectability Rosie O'Grady
Skittles Online
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Skittles
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TN
Or send the item for collection. They don't get the money until you get the money.
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#1940438 - 07/14/14 04:49 PM Re: Reason to Doubt Collectability Rosie O'Grady
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Thank you all!
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