So I get an unusual item in the mail - it’s from the Post Office, containing half of my credit card payment, being returned to me due to “damage in handling.” There’s half the payment coupon, and half my check - the left half, the part with my name, the bank’s name, the first part of my account number, and the words “Pay to the order of” followed by “Chase G”.
This leaves, on the half that Chase got, the date, my signature, the amount, part of my bank account number, and the words “old MC”. (I had made the check out to “Chase Gold MC.”)
Well I called them up, expecting to have a fight about the late fee, and I find there is no problem, they received my payment on time and it went through. The CSR was laughing, with a copy of their half of the check in her hand, telling me Chase will cash anything, even if you accidently made the check out to “Discover Card.”
That doesn’t surprise me, but what does surprise me is that my bank (Bank of America) paid the check. Isn’t there some bare minimum of information that must be present for a check to be valid? I’ve read Cecil’s classic on the subject (of course) and I seem to recall something about “suitable words of conveyance” being required - that’s the “Pay to the order of” part, which is on my half, along with the word “Chase”. Also, I would think the bank name would be helpful - since there’s no information indicating the bank on the right half of the check, how did Chase even know which bank to present the check to?
I’m bemused.
Next month I’m going to send them a handmade check painted on a the side of a cow, or a door, or something. We shall see.
You could go after BofA for honoring it, but then you’d be suspected of attempted bank fraud, so I wouldn’t advise it.
So Chase gets a scrap of paper with part of the MICR, the amount, and your signature.
Obviously, they not only could figure out the T/R (bank id) and account number, but they could also know to which account to post it (which impresses me more).
If I were do defend their action:
They knew the account, amount and had your signature. - 2 of three items.
What they did not have was payee - I would argue that it was your intention to name them as payee, because you sent the item to THEM.
I once got a call from a payee because I had sent the wrong check to them - I suspect the only reason it went tilt is because it was not the right amount - too little money.
You Could get creative in your choice of media, but you might find out the true meaning of “handling charge”…
Well I figure Chase found out my bank by looking at my records, and the bank found out my account number by looking at my name. It doesn’t surprise me that Chase did it, but it somewhat bothers me that Bank of America did. I’d like to think it would be difficult for someone to pass off a bogus check as being from me, but this makes me think it wouldn’t be that hard, really.
Chase may get their payments electronically, which would mean that the bank never even saw the check. It just impresses me that they didn’t take the opportunity to levy a late fee. Citibank would have been right on that!
Your check (originating bank and payee bank in the US) was settled through the Federal Reserve Bank.
This is done electronically - a transaction is coded to debit your account (BofA handles 100,000’s of these daily).
Once the data is input to the Fed, the default action is to pay it - BofA paid it long before the scrap showed up.
The lesson - anybody who can figure out how to code the Fed transaction (and get the Fed to accept it) can ding your account. The practical result of that is a WHOLE bunch of security concerning where the transactions come from and where they go.
and you really, really, don’t want to know about cc fraud (or, why cc interest rates are so high)
Doesn’t surprise me at all. Your bank is not really taking a risk.Neither is Chase.It’s unlikely my bank would accept a half-check that I tried to deposit, and I don’t think that they would pay a half-check drawn on my account that was presented by say, my sister, but large companies are treated somewhat differently.I’ve forgotten to sign a check to a large company more than once. Every one was paid, with no more than an “absence of signature guaranteed” stamped on the check, and sometimes not even that. Chase isn’t really worried that you are going to claim that the check you sent to them which was applied to your account was forged, and your bank isn’t worried about not being able to get the money back from Chase if it wasn’t meant for them.
Why are you so upset? If you deliberately mailed them the check, it was cashed by the intended party and for the correct amount, right? Would you have been upset if they cashed the WHOLE check?