Answer:
Regulation CC, which implements the Expedited Funds Availability Act, limits the duration of holds that can be placed on certain checks commonly referred to as "next-day" items. Among these checks are included cashier's, teller's and certified checks, checks on the U.S. Treasury, checks on the Federal Reserve Banks and Federal Home Loan Banks, U.S. Postal Service money orders, checks deposited in the bank on which they are drawn ("on-us" checks), and certain state and local government checks.
As a general rule, funds deposited in the form of "next-day" checks must be available for use by the depositor by the first business day after the date the funds are deposited. Certain conditions may have to be satisfied by the depositor to ensure that availability (use of a special deposit ticket for some of the next-day checks, for example).
If more than $5,000 is deposited by check to an account, however, the depositary bank may hold amounts over $5,000 until the 7th business day after the date of deposit, even if next-day checks (other than "on-us" checks) were deposited.
If the depositor has been repeatedly overdrawn in the previous 6 months, the entire amount of all deposits by check (other than "on-us" checks) can be held until the 7th business day.
If the depositary bank has a reasonable doubt that a particular check -- including "next-day" checks -- will be collected, it can withhold availability of the funds represented by that check until the 7th business day.
Finally, if the checks are deposited to a new account, a bank can delay access to funds from "next day" checks after the first $5,000 until the 9th business day.
Details on the holds that can be placed on next-day items can be found in Regulation CC's Section 229.13.
First published on BankersOnline.com 9/19/11
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