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Custodian Account-Depositing and Cash Back

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The kids that have jobs often come into the bank with their payroll checks wanting to deposit some money into their custodian account and get cash back at the same time from their payroll check. Is this allowed?

First, let's agree that you're not cashing those checks with any plan to charge them back to the custodial accounts if they bounce. The kids aren't owners of the accounts and you don't have a contractual right to touch the accounts for chargebacks except for checks deposited by the custodian.

With that out of the way, would you cash those checks knowing that you won't be able to recover from their respective custodial accounts if one of the payroll checks bounces? I think your answer is there.

First published on 7/23/12

First published on 07/23/2012

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