BST transaction gone very bad with "lost" check

[Exhibitman]

I have extensive work experience chasing financial fraudsters [NOT saying that there is fraud here, just providing a frame of reference for my suggestion]. The nice thing about checks is that they leave an auditable trail. Get a copy of the front and back of your cashed check. When you deposit a check the bank stamps it with information that can be reviewed to determine where it was deposited. If it went into an account that has nothing to do with the seller or originated from a place like a check cashing service that is not where the seller is located odds are the check was stolen and cashed by a third party and the seller really is innocent.

The law is stacked 100% in favor of the banks when it comes to checking accounts:

1. Banks do not have to dishonor a check you write just because you tell them it was stolen or lost. I just had to put one on a check at WFB [$31 for 6 months] but it is ineffective if the check is cashed anywhere other than at a branch of your bank. If the check is presented for deposit and sent to your bank while a hold is in effect it will be rejected, but that's the end of the protection.

2. Banks are not liable for not catching a stale check--or any other SNAFU or breach of their own account rules--if they have 'reasonable' methods in place to administer the account and one happens to slip through. That is in the Uniform Commercial Code, which has been adopted in nearly every state in some form. And you thought Little League was the last time in life you get a trophy for trying...

3. If the bank sends you a statement every month you may have as little as 30 days to catch even the most egregious fraud/bank error or the bank may not have liability for your losses. A client of mine recently caught an ex-employee embezzling funds over nearly three years by using a fraudulent transfer instruction and the bank was liable for just the prior month's unauthorized transaction.

Great info Adam!

Very sorry to hear of this trouble Ian. Straight theft IMO, that's frustrating to read how little recourse a victim has in cases of bank/check fraud. Good advice all.

[Luke]

I'm with Scott on this one. I don't have any knowledge beyond what you just wrote, but you're one of the most trustworthy people on here imo. If your gut instinct says this guy is responsible, he very likely is. I would probably hold off on naming names if you have any lawyers involved (or if you plan to have any involved). If not, or when the time is right, I do think he should be outed. This is awful. I hope you get it resolved favorably and in a timely manner.

Sorry to hear of all this Ian. I sincerely hope there is some quick resolution to this as you are truly one of the good guys.

[Rich Klein]

What if it was an honest slip up

I had a check in my wallet for 60 days before I did a search and found the darn check in my wallet, In this case, the item was paid for by the collector and he owned said item. It was me who forgot for 60 days to deposit.

It happens, just a thought and you should see some of what occurs to checks were I work:

We get checks that are not signed, made out to the wrong payee, not made out to any payee, wrong amounts, etc. We even once had a check made out to 250 -- and why -- because the fee was $250 and they wrote that as the pay to the order of.

Things happen!

Rich

[earlywynnfan]

Originally Posted by Rich Klein

What if it was an honest slip up

I had a check in my wallett for 60 days before I did a search and found the darn check in my wallet, In this case, the item was paid for by the collector and he owned said item. It was me who forgot for 60 days to deposit.

It happens, just a thought and you should see some of what occurs to checks were I work:

We get checks that are not signed, made out to the wrong payee, not made out to any payee, wrong amounts, etc. We even once had a check made out to 250 -- and why -- because the fee was $250 and they wrote that as the pay to the order of.

Things happen!

Rich

But if that buyer emailed you and asked why you hadn't cashed his check, would you dodge?


Like all, I'm unbelievably curious as to who this is, but I agree with someone above me. If this was a typical "I had a crappy transaction with --" then I'd say publish his name, but this sounds like the authorities need to be involved, in which case I'd hold on to the name. (Until it's all cleared up, then you must post it!!)

Ken

[Centauri]

Ian,

This may be of little solace, but a similar thing happened at my company - We paid a vendor by check, vendor claimed he didn't receive it, we sent a second check and placed a bank hold on the first check. The second check was cashed immediately. 7 months later, the first check was cashed. This is how I discovered the 6 month limit on a bank hold, and the unwillingness of the banks to deal with it after that.

We are still working with our bank and the other bank to try and recover the funds. $11,000 outstanding.

Banksters.

[earlywynnfan]

Originally Posted by Centauri

Ian,

This may be of little solace, but a similar thing happened at my company - We paid a vendor by check, vendor claimed he didn't receive it, we sent a second check and placed a bank hold on the first check. The second check was cashed immediately. 7 months later, the first check was cashed. This is how I discovered the 6 month limit on a bank hold, and the unwillingness of the banks to deal with it after that.

We are still working with our bank and the other bank to try and recover the funds. $11,000 outstanding.

Banksters.

To someone with no business banking experience, can you please explain why isn't this easily provable fraud??

[D. Bergin]

I guess that banks have decided since they don't get a piece of the transaction on most checks, like they do on credit cards (and they are all in the credit card business now), outside of managing the account. They couldn't care less about whether they've passed a bad check, except to string you along for fees on a hold.