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Jan 17, 2009

Fake Cashier's Checks

Protecting Customers from Fake Cashier's Checks
01/17/09 - BankersOnline by Mary Beth Guard

Bank Checks or Cashier's Checks can be fake. It takes 10 days to detect the fraud. Crooks are sending fake checks and asking for some or all of the money back before the fake is discovered. There are more stories at the link.

[edited] People may be misled about whether a cashier's check is good. Funds may be available a few days after deposit, but will be taken back if the check does not clear a week later. When bogus cashier's checks are deposited, some banks do not give accurate information about when the check will be cleared and good, so that the customer can safely use the funds.

Some banks say that the check will be good in 24 hours, or that the check is guaranteed good, so there are no worries about using the funds. Feeling safely assured, the bank customer goes through with the transaction. Days later, when the checks are found to be counterfeit, the banks hold their customer responsible for the entire amount of the check, even though the bank had assured them that the funds were good.

There should be laws that hold the banks responsible for releasing the funds from these checks before they verify that the check is good, or telling the customer that the check is good, only to announce days later that it is not. If they know it takes 10 days for the check to clear, they should tell that to the customer. Banks are issued warnings from the FDIC when cashier's checks are stolen from other banks, yet they do nothing to increase the security measures that they take when handling a cashier's check.

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