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Endorsement Acronyms

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There are different acronyms that banks have within their spray which they consider an endorsement. We recently cut a cashier's check to a credit card company on behalf of a customer, and we returned it for missing endorsement. Within the banks 'spray' it reads "PEG" Citibank, another acronym we've seen is "BOYD". Are these proper endorsements?

One of the goals of the Expedited Funds Availability Act and Regulation CC is the improvement of check handling speed in the system, and expediting return item processing in particular. Accordingly, the Fed designed the endorsement standards in Appendix D of Regulation CC to eliminate most of the extraneous visual clutter in bank endorsements.Part of the clutter is PEG (prior endorsements guaranteed), which is complete surplusage because the endorsing bank guarantees prior endorsements as a matter of law under the UCC. The Fed encourages banks to eliminate "PEG" from their endorsements, and it's surprising that Citibank has not heard the call.As for "BOYD", it could make sense as "BOFD," standing for Bank of First Deposit. That, too, is extraneous clutter, since the endorsement standards call for the routing number of the BOFD (a/k/a depositary bank) to be identified with inward-pointing arrows, thus: ==>011305749<==

First published on 8/30/10

First published on 08/30/2010

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