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Signing Over a Government Check

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Can a non-account holder sign over a government check to an account holder for deposit or cash on his/her account?

There's nothing to prevent it except for the bank's own policies. That is, there's nothing special about government checks that would prevent it. Many banks have tightened up their rules on accepting checks that have been negotiated to their customers. Exceptions might be made for businesses that cash their own employee's payroll checks, or customers that do actual check cashing as part of their business.

However, because the bank is not able to verify the endorsement of the original payee on these checks, the bank is at greater risk of handling a check with a forged endorsement. Forged endorsements are bombs with very long fuses -- three years long in most states. That's a risk that many banks don't want to take. Banks that do accept checks that have been negotiated to their customers, or on which their customers place an accommodation endorsement, usually do so only when they are very comfortable with their customer's willingness and ability to cover a bad check, their customer's good judgment about whose checks to endorse and the likelihood their customer will still be with them three years hence.

First published on 1/22/07

First published on 01/22/2007

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