The Straight Dope

Go Back   Straight Dope Message Board > Main > General Questions

Reply
 
Thread Tools Display Modes
  #1  
Old 01-10-2010, 10:49 AM
Machine Elf Machine Elf is offline
Guest
 
Join Date: Feb 2007
Possible to put "stop payment" on cashier's check?

I recently mailed out a cashier's check to pay off a vehicle loan. I sent it via certified mail so I'd know when/whether it arrived at its destination, but it got me to wondering about contingencies.

It's possible to tell one's back to issue a "stop payment" on a personal check you've written (that has not yet been cashed). Can a bank do the same thing with a cashier's check that they've issued on your behalf?
Reply With Quote
Advertisements  
  #2  
Old 01-10-2010, 12:08 PM
Fir na tine Fir na tine is offline
Guest
 
Join Date: Feb 2006
No.

Under the Uniform Commercial Code, the check is no longer an obligation of your's. It is an obligation of the bank that issued it and must be paid if presented properly endorsed. That's why Cashier's checks are preferred to personal or business checks.

If the check ends up being lost in the mail, your bank will probably require you to post a bond for the amount of the check before they will reissue. That's because "It is an obligation of the bank that issued it and must be paid if presented properly endorsed."

Last edited by Fir na tine; 01-10-2010 at 12:10 PM..
Reply With Quote
  #3  
Old 01-10-2010, 12:28 PM
IAmNotSpartacus IAmNotSpartacus is offline
Guest
 
Join Date: Jan 2007
Quote:
Originally Posted by Fir na tine View Post
If the check ends up being lost in the mail, your bank will probably require you to post a bond for the amount of the check before they will reissue. That's because "It is an obligation of the bank that issued it and must be paid if presented properly endorsed."
I worked at a bank for a couple years as a teller, we never had any customers posts bonds. They had to sign an affidavit, wait 90 days, and then they could get the check reissued. The bank would refuse to pay the original check thereafter. Not a stop payment in the common or literal sense, but the same result when all is said and done.

FWIW, the UCC doesn't mention anything about requiring a bond to be posted.

Last edited by IAmNotSpartacus; 01-10-2010 at 12:28 PM..
Reply With Quote
  #4  
Old 01-10-2010, 12:41 PM
Gfactor Gfactor is offline
of the Gladiators
Moderator
 
Join Date: Dec 2003
Location: Detroit
Posts: 9,491
No. But there are some cases in which the bank can refuse to honor the check:

Quote:
Can I put a stop payment order on a cashier's check?

A cashier's check is drawn directly on the bank that issues the check, not on your account. Generally, a bank must honor a cashier's check when it is presented for payment.

However, a stop payment can be placed in the event of a lost or fraudulent cashier's check.
http://www.helpwithmybank.gov/faqs/b...p_payment.html

Quote:
Question: When can a stop payment be placed on a cashier's check?

Answer: One cannot place a stop payment on a cashier's check.

A bank may refuse payment of its cashier's check under certain circumstances, such as alteration, forged endorsement, or a claim against the payee/presenter. But it should be sure of its position before doing so, because the penalties for wrongfully refusing payment are stiff. Particularly when a holder in due course is involved, the bank that refuses payment of its cashier's check is walking in a minefield.

Another situation in which a bank may refuse payment of a cashier's check is in the special circumstances of a lost, stolen or destroyed check, which are described in detail in UCC 3-312.

But stop payment, an emphatic "no."
http://www.bankersonline.com/operati...op072103d.html
Reply With Quote
  #5  
Old 01-12-2010, 05:55 PM
Fir na tine Fir na tine is offline
Guest
 
Join Date: Feb 2006
Quote:
Originally Posted by IAmNotSpartacus View Post
I worked at a bank for a couple years as a teller, we never had any customers posts bonds. They had to sign an affidavit, wait 90 days, and then they could get the check reissued. The bank would refuse to pay the original check thereafter. Not a stop payment in the common or literal sense, but the same result when all is said and done.

FWIW, the UCC doesn't mention anything about requiring a bond to be posted.
The bank was taking the business risk that the check would not be presented by a holder in due course AND that if it was, the person signing the affidavit would be able to reimburse the bank. Might be a reasonable risk, might not.


Yes, the UCC does not impose the requirement for a bond. Sound management does.
Reply With Quote
  #6  
Old 01-13-2010, 06:04 AM
CutterJohn CutterJohn is offline
Guest
 
Join Date: Nov 2007
Hrmm.. And here I have always used cashiers checks for large cash transfers because I assumed if it were lost, or I was robbed, etc, I could quick call the bank and have them cancel the thing.

It seems I've had the wrong impression.

Such being the case, how else could one safely transfer a large amount of cash while still having the ability to cancel the thing? I'm sure I could do this with checks of my own, but I rarely use the things so I never bother with them. Are personal checks the only way?
Reply With Quote
  #7  
Old 01-13-2010, 07:41 AM
Serenata67 Serenata67 is offline
Guest
 
Join Date: May 2009
Quote:
Originally Posted by IAmNotSpartacus View Post
I worked at a bank for a couple years as a teller, we never had any customers posts bonds. They had to sign an affidavit, wait 90 days, and then they could get the check reissued. The bank would refuse to pay the original check thereafter. Not a stop payment in the common or literal sense, but the same result when all is said and done.

FWIW, the UCC doesn't mention anything about requiring a bond to be posted.
I currently work at a bank, and was going to post that same response. We do have some recourse with a Cashier's check; it's not like once you make it out, there's nothing you can do about it. For instance, if you were to realize I spelled the name of the recipient wrong or made it for the wrong dollar amount, I could stamp it "not for purpose intended," cancel it out, and make a new one.

If it were to get lost in the mail, we can track it, make sure it hasn't been cashed, and if a sufficient time has passed, we can re-issue it.

Banking is customer service. Granted, it's highly regulated customer service, but we still want to help the customers. We'll do what it takes to make sure they get what they want from their bank.
Reply With Quote
  #8  
Old 01-13-2010, 07:42 AM
RealityChuck RealityChuck is offline
Charter Member
 
Join Date: Apr 1999
Location: Schenectady, NY, USA
Posts: 35,529
I didn't have any problem with it. I mailed a cashier's check to someone once; it never arrived. I went to the bank and they put out a stop payment, which meant it could not be cashed. However, they warned me that if it had already been cashed, I was SOL.
__________________
Author of Staroamer's Fate and Syron's Fate, now back in print.
Reply With Quote
  #9  
Old 01-13-2010, 08:21 AM
Mangetout Mangetout is online now
Charter Member
 
Join Date: May 2001
Location: England
Posts: 51,614
Quote:
Originally Posted by CutterJohn View Post
Such being the case, how else could one safely transfer a large amount of cash while still having the ability to cancel the thing?
Direct transfer is the safe way to move funds from one bank account to another - it's not easy to cancel if the receiving account belongs to someone else (i.e. you're not just moving savings to a current account), but it also removes some of the reasons you might want to cancel (lost or stolen cheque).

Last edited by Mangetout; 01-13-2010 at 08:22 AM..
Reply With Quote
  #10  
Old 01-13-2010, 08:33 AM
MitzeKatze MitzeKatze is offline
Guest
 
Join Date: Nov 2009
Quote:
Originally Posted by CutterJohn View Post
Hrmm.. And here I have always used cashiers checks for large cash transfers because I assumed if it were lost, or I was robbed, etc, I could quick call the bank and have them cancel the thing.

It seems I've had the wrong impression.
Wow, me too! When we lived overseas and had to deal with long-distance visitation for my step children (who lived with us, but visited their mother occasionally) part of the visitation orders were that we each had to pay half the costs. Plane tickets for unaccompanied minors between Guam and the states are very pricey, and the easiest and cheapest way was for one of us parents to purchase the round-trip tickets while the other reimbursed half. We routinely used cashiers checks to send to bio-mom to do this. We did not (and do not) trust her with financial issues and thought we were protecting ourselves (and to a lesser extent her as well) by using cashiers checks instead of personal checks, thinking they would be easier to cancel or trace if something went wrong. I guess it is a good thing we never had to test that theory.

Quote:
Originally Posted by Mangetout View Post
Direct transfer is the safe way to move funds from one bank account to another - it's not easy to cancel if the receiving account belongs to someone else (i.e. you're not just moving savings to a current account), but it also removes some of the reasons you might want to cancel (lost or stolen cheque).
Not to hijack the thread or sound really, really ignorant of financial dealings (though I am) but how would one go about transferring money into someone else's account (at a differing bank)? I know how to set up auto-payments and such but to a personal account, how would that work? I know I could ask my bank, but it is easier to ask here.
Reply With Quote
  #11  
Old 01-13-2010, 08:53 AM
Mangetout Mangetout is online now
Charter Member
 
Join Date: May 2001
Location: England
Posts: 51,614
Quote:
Originally Posted by MitzeKatze View Post
Not to hijack the thread or sound really, really ignorant of financial dealings (though I am) but how would one go about transferring money into someone else's account (at a differing bank)? I know how to set up auto-payments and such but to a personal account, how would that work? I know I could ask my bank, but it is easier to ask here.
In the UK, it works something like this:
  • The recipient tells the sender his/her account number and sort code (this scares some people, but they give out the same information on every cheque they write)
  • The sender goes into his/her bank and instructs them to transfer X amount of
    money into the recipient's account (or in some cases, this can be done online, if the sender is set up for online banking)
Reply With Quote
  #12  
Old 01-13-2010, 09:04 AM
MitzeKatze MitzeKatze is offline
Guest
 
Join Date: Nov 2009
Quote:
Originally Posted by Mangetout View Post
In the UK, it works something like this:
  • The recipient tells the sender his/her account number and sort code (this scares some people, but they give out the same information on every cheque they write)
  • The sender goes into his/her bank and instructs them to transfer X amount of
    money into the recipient's account (or in some cases, this can be done online, if the sender is set up for online banking)
Ha! It would be so simple and be something that utterly baffled me. I assume it is a similar situation here and that "sort code" is the same as a routing number (which is pre-printed on personal checks just before the account number). This might come in handy the next time I have need to give someone a large amount of money (not that I expect to do so anytime soon). Thanks.
Reply With Quote
  #13  
Old 01-13-2010, 09:25 AM
Mangetout Mangetout is online now
Charter Member
 
Join Date: May 2001
Location: England
Posts: 51,614
Yes, I believe routing number is the equivalent term for UK 'sort code'.
Reply With Quote
  #14  
Old 01-13-2010, 10:16 AM
Driver8 Driver8 is offline
Member
 
Join Date: Nov 2004
Location: Bellevue, WA
Posts: 1,462
Quote:
Originally Posted by Mangetout View Post
In the UK, it works something like this:
  • The recipient tells the sender his/her account number and sort code (this scares some people, but they give out the same information on every cheque they write)
  • The sender goes into his/her bank and instructs them to transfer X amount of
    money into the recipient's account (or in some cases, this can be done online, if the sender is set up for online banking)
This is how it works in South Africa as well. It is very easy to electronically transfer money to another individual. For example, when I lived back in Cape Town my roommate transferred half the rent into my account and I transferred the entire rent into the landlords account. Very easy.

It is a bit lame in the United States: I use a Bill Pay feature to regularly transfer money to other people but all it does it print out and mail them a check, which they have to deposit. It works well enough as the payer but is inconvenient to the payee.
Reply With Quote
Reply



Bookmarks

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is Off
HTML code is Off

Forum Jump


All times are GMT -5. The time now is 12:59 PM.


Powered by vBulletin® Version 3.8.7
Copyright ©2000 - 2014, vBulletin Solutions, Inc.

Send questions for Cecil Adams to: cecil@chicagoreader.com

Send comments about this website to: webmaster@straightdope.com

Terms of Use / Privacy Policy

Advertise on the Straight Dope!
(Your direct line to thousands of the smartest, hippest people on the planet, plus a few total dipsticks.)

Publishers - interested in subscribing to the Straight Dope?
Write to: sdsubscriptions@chicagoreader.com.

Copyright 2013 Sun-Times Media, LLC.