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Check Presentment Limits

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Is there a limit on how many times a check may be presented to the drawer bank for payment?

Section 3.1(f) of Federal Reserve Operating Circular 3 indicates that if "The item has been dishonored two or more times." it will not be handled as a cash item; i.e. you cannot use the clearing system to collect it.

If a merchant posts proper notification and follows the other requirements of OG 145 under the ACH rules, it may convert the item to an RCK or an electronic debit and present it a third time.

After that, the return of the item would be "bank to bank." The drawee bank might stamp the item "do not present again," after the second presentment through the clearing system, but generally that is a function of their patience, not a law or regulation.

First published on 11/5/01

First published on 11/05/2001

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