Citing possible counterfeit bills, many businesses in North America put up signs saying they are “unable to accept $100 bills.” Is this practice legal? Are business not obligated to accept any currency deemed legal tender by the government?
I don’t know about the USA, but in Europe some stores refuse to take 100 euro-bills, and yes, this is legal. 100-bills are normally considered for “business-use” only, and you won’t see a lot of them in day-to-day life.
“Legal tender” doesn’t mean a merchant is obliged to accept it as payment. It means creditors are obliged to accept it as payment of debts. Merchants can legally specify payment in anything they want. If they say payment in hog belly futures only, that’s just fine so far as the law is concerned.
From the Treasury Dept: There is no Federal statute which requires the acceptance of currency for payment or prohibits the restriction by businesses on denominations they will accept. State laws may apply. Therefore, businesses may set their own policies on payment by currency ( no cash sent in to pay the phone bill), small coinage ( payment in pennies ) or large denominations ( no $50 bills at the gas station ).
United States Code, Title 31, section 392
Gorsnak, doesn’t the first part and last part of your post oppose each other? Creditors are obligated to accept it, yet they can legally specify payment in anything they want. One side must give.
Has anyone ever gone to a store that doesn’t accept $100 bills and that’s all you had to pay with? What happens then? I’m sure they will take that over nothing.
I don’t think the first and second part of ** Gorsnak **'s post oppose each other. Merchants and creditors are two different kinds of people, right?
Indeed. You don’t owe a debt to the person you’re buying stuff from. Now, if that person gave you a tab and let you run up stuff on credit, they would be bound to accept legal tender for settling up. But purchases are another matter.
I was at a store buying beer, when the customer in front of me ran head on into this regulation. He was buying a huge amount of beer, like thirty or forty cases, and after they rang it through, he produced a thick wad of 100’s to pay for it. The clerk said sorry we don’t accept hundreds, and the guy replied that’s all he had. The beer store guy had a form the customer had to fill out with all his particulars, and had to show them two pieces of ID, but he got to use his 100’s. I don’t know if they would do that for a smaller purchase though, in fact I would think they wouldn’t.
You are correct, and this is the crux of it.
That is - because you have carried the items to the counter to pay for them, you have not yet incurred a debt. Yet, if the electric company lets you run up a tab of electricity usage fees all month, then bills you, then they have to accept the legal tender.
However, there are gray areas. An example which came to head once here (related by a police officer on the force who was involved, which all took place in SE Kansas), was a person who filled the gas tank on his RV (about a $40 fillup - it would have been about 100 quid in the UK), then went inside to pay for it with a $100. The clerk refused to accept it, saying that they didn’t take $100’s. The man said that was all he had (he had one credit card, which the place didn’t accept). The clerk said they wouldn’t take it, and demanded payment before he left. The man said he was leaving unless they took it, and turned around and walked out of the store, but not before leaving the $100 bill on the counter, without getting any change for it!
You can guess what happened. Even though he had the $100 in-hand, the fucknugget clerk called the police on him, and reported a gasoline robbery. The man was arrested, and even though the clerk admitted that the man had left a $100 bill, he still tried to call it a robbery, since the store did not accept $100’s.
So the man was held in the local jail overnight, while his family camped in the RV in the jail parking lot, and it took until the next day for a judge to determine:
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Since there was no sign stating the policy at the pump, they had to take $100’s, because a debt could be incurred without knowing that $100’s were not accepted.
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The man paid for his debt in full.
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In what seems like it must have been an unusual or illegal statement, he (the judge) suggested in court that the man seek a civil remedy against the merchant and the clerk, as he found the whole thing “outrageous and stupid”.
In case it wasn’t clear, in the anecdote I related, the man had already filled his tank up with 50-some gallons of gasoline before going inside to pay for it. It was impractical and dangerous for him to try and un-ring that bell, so to speak…
Not exactly on point, but read the Master’s take on using small currency units. As a bonus, here’s another story about stupid merchants.
I heard that 2 buck bill story about another store and instead of the security guy they called the cops. Sounds like an urban lengend to me.
Suppose this is true.
What if you stuff yourself first before you take the wrappers to the cashier? Can you then pay with any banknotes?
You are limiting yourself to retailers.
Businesses include a lot of things, such as restaurants. At such places where you eat their food/use their services/etc. first, you do indeed own a debt.
During High School, I had a summer job working the register at a Taco Bell, where we weren’t supposed to accept anything over $20. Every now and again, someone would pay using a $50 or $100, which I would gladly accept, if there was enough change. I didn’t care if the company got stuck with counterfeit currency, as it wouldn’t come out of MY pay, and keeping things moving meant that my shift would seem to go faster.
Snopes was unable to determine the veracity of the Taco Bell story. But the article does have a link to reader’s experiences with unusual currency. The story is certainly plausible, but whether it actually happened exactly that way is indeterminate.
In a store, I call that “stealing.” In a restaurant situation, though, I dunno. I have eaten at numerous restaurants that stated “No bills above $20.00” on the menu…
hrh
Why? What is it about large bills that they don’t like? I’ve never seen anything like that down here, where some ATMs will gladly give you only 50’s or 100’s so you’re left with no choice.
Someone mentioned counterfeiting - is that really all the fear is? Isn’t that a phenomenally low risk?
Usually, it’s so merchants can keep less cash in the drawer, to lessen loss in case of robbery. If they take higher bills as a matter of course, they have to keep much more cash available than if they only take up to $20 bills. I’ve always worked in such places, but would make change for higher denominations if I had the cash available.
hrh
In Canada it is most certainly because of fears of counterfeiting. The government recently began releasing new anti-counterfeit notes with several intricate safety features because counterfeiting was such a problem.