Last night, while the in-laws were deciding who was going to what store for Black Friday, my SIL had to give someone money to cover the purchases. She handed her a blank, signed check, and said “Just let me know what amount you have to fill in so I can log it.”
Naturally, I would only do this with relatives or very close friends who I could trust. Then I thought “What’s to stop them from adding an extra zero, or an extra $50 to the check?”
My question is, could my SIL have written “Check Void over $250” or something similar on the memo line (the way money orders do under the computer printed amount)? Would this be honored by the bank?
I don’t think so, but I don’t really know. Of course, a lot of stores require that they see you sign the check before they’ll take it, so it would mostly be a moot point anyway if the check was meant to be used to actually purchase something. If it’s not actually being used to purchase something, it would have be easier and more efficient to give them a check after the fact.
The check would go from SIL to FIL, it wouldn’t be a third party check. SIL is going out of town for a week or so, wouldn’t see her dad for a while, and didn’t want him to be out the money for too long. She’s essentially paying him back in advance. He can make the purchase with his check, fill in the amount on her check, and deposit it into his account.
Placing restrictive endorsements on a check (Void over $xx, void after date) is very risky as banks aren’t required to look for or honor such notations. They only serve to discourage the already-honest people from messing with the check.
I don’t have the cite handy, but even putting “this is not a check” on the memo line won’t have any effect. Banks just look for the ABA and account numbers down at the bottom in that funny-looking MICR print and someone scanning checks at about the same blinding speed as the bygone postal sorters reads the dollar amount and keys it in to be MICR-encoded on the check.
With the new check-processing rules (called Check 21) more and more checks won’t even get to a bank in the first place for a teller to look at. They’ll be scanned and transmitted electronically for payment. Walmart’s been doing this for a while, already. They scan the check and destroy it at the store or at a regional office. I’ve personally had merchants run my check through a MICR reader and hand the check back to me, effectively cancelled and converted into purely electronic money.
Mrs Geek managed to lose her purse about a month ago. When we put a hold on the account, we knew which checks were still valid, and they entered a special note on the computer screen to pay check numbers such and such. They basically had 3 lines to enter whatever text they wanted about what got paid and what didn’t.
This would require you to put a temporary stop on your account. The guy at the bank said it wasn’t guaranteed that they would process it right, but that they were supposed to read the screen and not just bounce the check.
I don’t know if all banks follow the same rules. I know the idiots at my former bank could absolutely NOT be trusted to handle something like this without screwing it up (hence they are my former bank).
A lot of checks from business have “Not good for over $x” or something similar on them. I don’t know how effective this is.
I once sent my son a check and forgot to sign it. I told him to sign my name and I’d not protest the signature if there was a question. Then I told my Credit Union to honor the check and was told that anyone could have signed my name and it wouldn’t be questioned. As far as my Credit Union is concerned all that the system looks for are the date, the amount and the presence of the correct magnetic numbers printed on the check. It the check is forged or otherwise altered you have to do the policing and make a protest. The default is to honor the check if the above conditions are met.