We have an account in a US bank, and paid something with a $1500-cheque that the recipient deposited in his Wachovia bank account (we don’t bank with Wachovia, we’ll call our bank Mighty_Girl’s Bank, MGB for short).
So, I get a call from the recipient saying that our cheque bounced. :eek: We have more than enough to cover that cheque and I am therefore freaked out. I say I have to check, so I go to my online banking page. Yes, there’s still more than enough money to cover the cheque, and the cheque appears as “paid” in our statement. Furthermore, there is a copy of the front and back of the cheque with all the necessary stamps.
I call MGB, they agree that the cheque was paid and money debited from our account and seem equally freaked out. I make a conference call with MGB and the company that has our cheque. They confirm that yes, they have the actual cheque, and yes, it says the reason for non-payment is “insufficient funds”. They will send MGB all their details and my bank will investigate. The cheque has no errors in amounts or names.
So… any idea what’s going on? This doesn’t fill me with a whole lot of confidence in the banking system.
Although I was mildly embarrassed by this situation, the fact that my bank assured my vendor, that yes, there is sufficient funds to cover the cheque, and yes, the cheque was indeed paid, made it slightly better. I don’t look like a deadbeat customer. And I sure as hell I am not going to pay any fees resulting from this.
My best guess is that somone in a proof department somewhere mis-keyed an account number, or that a MICR scanner had a hiccup and mis-read the check.
Millions, if not billions of transactions happen every day. The overwhelming majority of them fly through with no problems. But, even if the error rate is only .000001%, that’s still a few thousand every day that go sideways.
You have the check that shows it’s gone through and been paid. Your bank appears to be on your side and equally confused that they paid it but another bank said it’s NSF. They will most likely advise the other bank that it was paid, and internal adjustments will be made so the vendor’s account is properly credited, and you (and the vendor) won’t be hit for any bad-check fees.
A bank once told me that payment on checks is occasionally refused for a wide variety of reasons when there are no errors on the check and sufficient funds to cover it, and that it is often impossible to figure out why the check was refused. Though, I never heard anything about this happening while the check is also marked as paid, in the view of the account holder.
My vendor told me that he received another bounced cheque from another customer and the circumstances are identical. The other customer does not bank with MGB. It’s getting weirder.
Perhaps the funds are there but not cleared, or someone put a hold on them. I have had checks cashed and then six month later the bank reveresed it saying the check was bad.
Especially if the account is tied to a debit card, you can have places put “holds” on money. That money won’t be withdrawn but some banks count it as gone in terms of paying your checks.
Most banks put a lot of restriction on what “available” means so they can charge you overdraft fees as much as possible.
If it isn’t an error it has to be your concept of “funds available” is different from the banks
I am not in the banking business and I don’t know what the processing workflow is for a check within the paying bank, but but it seems simply impossible for your bank to be able to show you a copy of the check stamped paid and the other bank holding the actual check marked “insufficient funds.” Clearly if there was a mistake, MGB made it.
Please be sure to post to let us all know the outcome of MGB’s investigation!
I don’t have a debit card tied to that account. I am the only one that uses it as it is my business account. The account has more than enough money to cover that cheque many times over. MGB cannot explain how this happened.
My bank refused to pay a check that my mortgage company failed to endorse. It got pretty sticky, with CHASE (the mortgage company from hell) treating me as if it were my or my bank’s error.
MGB has investigated and the problem seemed to be at Wachovia’s end. At least that’s what they claim, and I tend to believe it since my vendor has confirmed that in the other case identical to mine the customer does *not *bank with MGB.
In the meantime I don’t have the money, and he doesn’t either.
Something very strange has happened if you’ve got the check image with all of the appropriate stamps showing it was paid, but the vendor has the original check. If I had to guess, I’d guess something went wacky at the vendor’s bank after they imaged it and someone tried to run it twice.
More and more often, when a check is deposited at a bank, it is “truncated” - the bank will scan it and then destroy the paper. The check is now an electronic item that can be sent around the banking system without the pesky burden of being a physical thing that needs to be packaged and moved. The Check 21 system is an amazing thing that’s revolutionized how paper checks are handled, even if it was a bit late and far fewer checks are being written now, in favor of point-of-sale debit card transactions and electronic billpay.
If the batch was run twice, or if the check was scanned twice, somewhere along the line, a computer’s going to say “I’ve already processed check #2405 on account 1210816620” and throws it back. If the check was presented twice in close enough succession, it’s entirely possible that the “Hey, this is a duplicate!” message got back to the bank before the “This will be paid” message.
Again, this is only a guess. It’s been a few years since I’ve been actively involved in Deposit Operations, but AFAIK, that’s still how checks are handled.
I spent about 90 minutes today with my bank, who refuse to get any more involved saying they did nothing wrong and me having the scan of the cheque means that everything is hunky dory in our side.
In the meantime my vendor, though extremely helpful and patient, is still missing his money.
Given your location line, your spelling of “cheque,” and your specific mention of having an account "in a U.S. bank, " is it possible the international nature of this transaction has something to do with it?