Post: #1

So this was news to me, because I was always under the impression that checks were significantly more secure than using cash, but apparently, they're essentially cash in a different form (at least in Canada). I came across this in a different forum, it's a little dated, but based on other replies, apparently it is still happening.

You wrote it, you pay it

Quote:Larry Traverence thought a cancelled cheque meant it couldn't be cashed — that the bank would stop any payment.

So when an employee at his property management company in Vancouver told him he'd lost his $1,250 paycheque and needed a replacement, Traverence put a so-called "stop payment" on the first one and issued a new cheque

At least me, and believe (perhaps foolishly?) most people think this is how checks work.

Quote:So imagine his surprise when Traverence discovered his employee had cashed the new paycheque, plus the original cheque, at Money Mart, a cheque-cashing and payday loan chain with more than 350 branches in Canada.

It turns out the employee wasn't on the hook for the cheque he knew had been cancelled; Traverence was.

It turns out that a "stop-payment" is not legally binding, and essentially once you sign a check, you are legally on the hook for it, no matter what.

While checks are no longer used nearly as much as they were at one time, many landlords and small time contractors request post dated checks, or some money upfront in the form of a check, and if for whatever reason they do not fulfill their end of the bargain but cash it anyways, you essentially have no recourse, short of taking the person who cashed the check to small claims court.

Anyways I researched how to combat this, and discovered "crossing a check" which basically means it cannot be cashed, rather it can only be deposited into an account.

http://www.bankersadda.com/2014/02/banki...eques.html

The limited times I've used checks and post-dated checks I've never had an issue, because frankly most people are honest, but it did make me think how much at risk I could have been. would love to hear from others perhaps better versed in check law and who know how to stay safe.

Post: #2

Weird, in the US i've had to cancel a check before it was cashed and the check didn't go through almost immediately. Just resent it.

They must do things differently in Canada. I know your legally allowed to future date checks there.

If that employee was honest, he'd return the money and his boss should reward him with a few days of paid time off. I doubt either party will want to work with the other.

Post: #3

Post dating a check is irrelevant. Even signatures are pretty much irrelevant. I've seen ancient checks go through, post dated checks go through, improperly signed checks go through (requires two only has one sig), and even unsigned checks go through. Even the expires within 90 days or whatever it says at the top is pretty much irrelevant. Once it leaves your hand you can be sure it will be cashed. No one looks at checks anymore it's all automated.

(In the US)- A stop payment on a check is only valid for 6 months. After the 6 months are up you have to do it again, or risk the person cashing the check. Sometimes you are better off closing your account.

I have seen it where we wrote a huge check, the check got lost, sent a new one, and both checks get cashed. If it's a vendor you do business with on the regular then you can try to get the cash back, but once the cash leaves your account it is generally a one way street. In our situation there was no way for us to get the cash back, so we just used it as a credit balance on future invoices.

Post: #4

I'm still amazed people are still using cheques. Only folks using them in the UK are in the latter half of their life and I can see them being scrapped altogether in the next 10-20 years. I do accountancy work so I have a very good understanding of how common they are used. Only stores that are both independent and cater to old folk (local butchers for example) still accept cheques.

Most stores won't accept them and are using merchant services and paying a fixed fee + commission for the privillage or cash payments as their method of receiving money. Depending on the goods or services that are being supplied bank transfers or gyro is common too.

Cheques themselves are no longer guaranteed by the bank in the UK so they are essentially useless and are only accepted from people you trust. Cheques here automatically expire after 6 months and can easily be cancelled by notifying your bank. I always thought they were too easily open to fraud so have never used them myself.

Employers tend to pay wages by BACS now with very few still using cash. Cheques are very rare for employee wages although it still does happen.

Post: #5

(11-22-2016 02:21 PM)Ethan Hunt Wrote:  I'm still amazed people are still using cheques. Only folks using them in the UK are in the latter half of their life and I can see them being scrapped altogether in the next 10-20 years. I do accountancy work so I have a very good understanding of how common they are used. Only stores that are both independent and cater to old folk (local butchers for example) still accept cheques.

Most stores won't accept them and are using merchant services and paying a fixed fee + commission for the privillage or cash payments as their method of receiving money. Depending on the goods or services that are being supplied bank transfers or gyro is common too.

Cheques themselves are no longer guaranteed by the bank in the UK so they are essentially useless and are only accepted from people you trust. Cheques here automatically expire after 6 months and can easily be cancelled by notifying your bank. I always thought they were too easily open to fraud so have never used them myself.

Employers tend to pay wages by BACS now with very few still using cash. Cheques are very rare for employee wages although it still does happen.

This isn't the case at all in the USA. In fact, check payments are the norm.

Post: #6

In the United States, I always use credit cards whenever possible to pay for things. You get cash back or airline miles, plus a 0% liability for fraud that you report on your account. America has very strong consumer protection against fraud with consumer credit cards.

Post: #7

Random pro-tip:

If you have any checks that are "expired" (past 90 days or whatever) just deposit them at your banks ATM. They go through without issue, at least at Chase. (US)

Post: #8

That's part of the reason I brought this up, is that when I lived down in the states 5 years ago, checks were everywhere. The drive through banking terminals even had those vacuum tubes so you could send them back and forth. I had never seen something like that, and just got incredibly frustrated when 3 old ladies ahead of me at the grocery store would all decide to pay with checks for their two items.

This is an interesting but old story, couldn't find the original but found a copy on a message board. It's a bit long, but essentially in the 90s a guy tried to cash one of those obviously fake scam checks you get sent in the mail for $95k as a joke.

http://www.valvetime.net/threads/great-s...ad.118056/

Anyway, the bank ended up cashing it, and it just talks about what happened, the outcome, and touches a bit on check law. Apparently there's a certain set of 'litmus tests' to determine what constitutes a valid check, and writing "non-negotiable" on one isn't any more binding than writing "not a car" on your car's door with a sharpie. The company unknowingly sent out valid checks, and the bank was sloppy with their procedures when the check eventually came back NSF, so legally apparently the money may have been his, but it never got that far since he did end up returning it.

Post: #9

Don't use checks unless you have to. Checks have your name and bank account information on them.

Post: #10

You can get by without using checks. Automate all your payments online. All my recurring bills are charged to my credit card. Utilities, internet, insurance, etc.

The main reason for me is that I only have to remember one payment date instead of half a dozen. The second reason is credit cards are the most secure.

My card got hacked last week. I got an email from American Express and called them right away. They cleaned everything up and are shipping me a new card with a new number. I avoid using my debit card for this reason.

But you have to be careful with credit cards. It's easy to spend more than you normally would with a checking account. I've been guilty of buying random shit I don't need because it's on credit.

And guard your credit score with your life.

Post: #11

(11-22-2016 08:22 PM)zoom Wrote:  Don't use checks unless you have to. Checks have your name and bank account information on them.

That's the reality of the current financial model.

Both checks and cards work by giving someone else the account information to where your wealth is stored, and then trusting them to only take what you allowed them.

I'm not terribly knowledgeable about it, but banks are creaming their panties over potential solutions like blockchain.