Topic: Cashier’s Checks
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We sell both money orders and cashier’s checks. Under the new Illinois unclaimed property law, should we apply a three year abandonment period to both products?
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No, we read the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA) as imposing a three-year presumed abandonment period on cashier’s checks and a longer, seven-year presumed abandonment period on money orders. The Illinois RUUPA defines “money order” as “a payment order for a specified amount of money” and refers to cashier’s checks as instruments…
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The new Illinois unclaimed property law imports similar language from the previous law regarding linked accounts that share the same the mailing address in our books and records. Would that language apply to money orders or cashier’s checks?
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No, we do not believe that the “linked account” language in the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA) would apply to money orders and other instruments on which a financial institution is directly liable. That language applies only to “accounts.” While the term “accounts” is not defined in the law, we do not…
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Our institution sells two types of instruments, money orders and cashier’s checks. We sell money orders in amounts up to $2,500 and cashier’s checks for larger amounts. For cashier’s checks, we print the payee on the check, but for money orders, the payee is blank. When these products become unclaimed property, who should we report as the owner? We currently report cashier’s checks as owned by the payee and money orders as having unknown owners.
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We believe that your bank may continue to report the owner of these instruments as the payee, if the payee is known. For money orders that are sold with a blank payee line, we believe that reporting the owner as “unknown” would be acceptable. The Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA) requires property…
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An internal audit revealed a record of a cashier’s check that is stale. We would like to contact the purchaser to determine if the check was ever provided to the payee or if the purchaser would like the check to be reissued. Our records indicate that a husband and wife co-owned an account with us, and the wife purchased the cashier’s check when she closed the account. We believe the account was closed as part of the couple’s divorce. Should we contact both account owners or just the wife, who was the only one to actually purchase the check?
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In our view, you should reach out to the purchaser of the cashier’s check (the wife) if you wish to determine whether the check was ever delivered to the payee. Regulation P generally prohibits a bank from disclosing nonpublic personal information about a consumer, including “the fact that an individual is or has been one…
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Can our bank put an expiration date on cashier’s checks to prevent them from being held for long periods of time? If so, what is the minimum length of time before a cashier’s check expires?
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We do not recommend placing expiration dates on cashier’s checks. While we are not aware of any law or court decision that would expressly prohibit this practice, Illinois courts treat cashier’s check as “cash equivalents” once they have entered the stream of commerce. Needless to say, cash and cash equivalents have no expiration date. While…
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We have a customer who purchased a number of cashier’s checks dating back to 2014 that he has not yet delivered to the payees. Can we request that he redeem those checks or allow us to reissue them with more current dates?
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We believe that you may request — but not require — the customer to surrender the checks to your bank and have them reissued. The Illinois Supreme Court has recognized that the remitter of a cashier’s check remains the owner of the check until it has been remitted to the payee, and therefore the remitter…
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Under the new Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA), are cashier’s checks subject to a different presumed abandonment period than money orders?
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Yes, the Illinois RUUPA establishes different presumed abandonment periods for money orders and cashier’s checks. Money orders are subject to a longer, seven-year presumed abandonment period, while cashier’s checks are subject to a shorter, three-year period. The law defines “money order” as “a payment order for a specified amount of money” and refers to cashier’s…
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Many years ago, a customer purchased a cashier’s check naming his sister as the remitter and the Social Security Administration (SSA) as the payee. The remitter does not have an account with us. We are still gathering facts, but we believe that the remitter never delivered the check to the SSA. It has remained in her desk drawer since 2003. Now she has sent us a demand letter from her attorney insisting that she is entitled to receive a refund on the cashier’s check. We found a note indicating that we reissued the check in 2004, but we have not found a declaration of loss or any other records regarding the possible reissuance. Is the remitter entitled to a refund on the original check?
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We recommend consulting with an attorney, but in our view, the remitter likely is entitled to a refund for the amount of the cashier’s check. The Uniform Commercial Code (UCC) does not directly address whether a remitter is entitled to a refund when she decides not to deliver the check to the payee. However, the…
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We have a customer that recently purchased a $28,000 cashier’s check with cash to pay the winner of a drawing. The customer also recently deposited $77,000 in cash proceeds from the drawing. How do we fill out the currency transaction report (CTR) to incorporate both transactions? On Item 21 of the CTR form, we are supposed to list the total “cash in” amount for the entity, where we included the $77,000 deposit. But where do we add the cashier’s check purchase? Do we add a line to Item 21? Also, should we create a Part I (Person Involved in Transaction) for our bank for the cashier’s check purchase, because our bank was involved in that currency transaction?
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In our view, the appropriate place to list the individual amounts of the deposit and the cash purchase of the cashier’s check is in Item 25 on the CTR. Item 25 is used to identify the amount and type of each individual “cash in” transaction, along with the total of all the “cash in” transactions.…
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A fraudster sent one of our customers a cashier’s check and told the customer to return excess funds by wire (that cashier’s check subsequently was returned and charged back to the customer’s account). Our customer instead purchased a cashier’s check and sent it to the fraudster. The fraudster is using this check, including the signature of our teller, to create fake cashier’s checks, which are being sent all over the country. We have received dozens of calls from the recipients, and one recipient took the story to a local news channel (we declined to comment on the story). We also are returning several of these checks daily. So far, our bank has not suffered a loss, but is there anything else that we should be doing? Should we contact our local law enforcement?
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This is serious fraudulent activity, and we recommend consulting with your bank counsel immediately to discuss a strategy for safeguarding against potential monetary, regulatory and reputational risks. Meanwhile, we would recommend that you contact local law enforcement, as well as the FBI. In addition, you should contact your primary federal regulator (the FDIC) to report…