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24 Hour Return Deadline for Returned Check

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Question: 
We deposited an item for a member on 06/14/12. The item has been returned to us today (07/10/12) as "refer to maker" "altered item." I believe we can refuse the return due to the 24 hour return deadline being missed, is this correct?
Answer: 

Yes. The paying bank is well beyond its midnight deadline for a conventional return of that check. Your bank can, and should, refuse the return as late. Keep a copy, though, because you've been put on notice that the paying bank will come after you on a warranty claim (which is how it should have proceeded in the first place) under UCC 4-208 (Presentment Warranty).

I also suggest that you research now rather than later how your bank received the check -- was it deposited or cashed? And, if your depositor is involved, consider grabbing the funds now (if possible) rather than later, setting them aside pending receipt of the claim from the other bank.

First published on BankersOnline.com 11/12/12

First published on 11/12/2012

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