Time Frame for Consumer and Commercial Accounts

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Question:

We have a customer who has informed us of a fraudulent check that has cleared his account. He let us know in five days, well after the midnight deadline the day after the check cleared but a reasonable time frame and within our account agreement. Is there a different time frame between consumer and commercial accounts?

Answer:

State law, e.g. the UCC, normally does not differentiate between consumer and commercial accounts regarding the processing of checks. You would have to refer to State law. Some of the State UCC laws can be modified via your contract with the customer. Only your legal counsel can advise you regarding the impact of any contractual language you have in your depositor's agreement.