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Fraudulent Checks Presented-24 Hour Return Window?

Answered by: 
Ken Golliher

Question: 
We have a commercial account which has had fraudulently created checks presented against it. When we returned these items to the bank that cashed them, that bank sent them back stating there was only a 24 hour window to return. We initially returned them back as fraud within two weeks of receipt. Shouldn't that bank accept the check and the loss?
Answer: 

Your bank is responsible for recognizing its customer's signature. You had until midnight of the banking day following the banking day of presentment to return the items; i.e. your return was "late."

The law assumes that banks physically inspect checks prior to final payment. Banks that do not accept the risk of loss as a cost of doing business.

First published on 11/19/2017

Filed under: 
Compliance
Filed under compliance as: 
Check Presentment
Fraud

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