By failing to properly answer the question “when will this check clear,” the largest bank in the country is misleading its customers and is playing into the hands of scammers.
Scammers know that many banks – including Bank of America -Â fail to properly train their tellers to tell customers that it could take two weeks for a check “to clear.”
Instead of explaining that, many tellers instead tell customers when the money from the check will be available for their use, which is not the same thing.
The reason its a big deal is that the term “to clear” is a very specific legal phrase. It means the time when money actually comes out of the check writer’s account and is provided to the bank which cashed the check.
Scammers – frequently involving work at home schemes – send checks to victims and instruct them to deposit them and to mail back a money order once the scammers’ check “clears.”Â
When funds are available simply means the number of days banks are permitted by law to hold a check in a customer’s account before it is required to make the money available.
If the check later does not clear, it is the customer that the bank will go after to reclaim the money.
That wasn’t always the case. Many years ago banks would not make funds from checks available, especially those drawn on out of state banks, until they actually clear.
But because consumers were upset with the banks holding on to their money, sometimes for weeks, banks were forced by regulators to release funds even if the checks had not yet cleared.
Many have become victims because their bank told them their money was available when the victims asked if their checks had cleared.
After a Webster Bank customer was burnt last year, Webster Bank CEO Jim Smith promised to have his tellers retrained to give the proper answer.
I tested that last month by going to three Webster Bank branches in Connecticut and Massachusetts and asked tellers when a check from a different part of the country would clear. All three explained clearly that it might take a week or more for check to clear, but the money would be available to me in a day.
However, when I went to three Bank of America branches in Hartford and West Hartford Monday, all three tellers gave me the incorrect answer. They all said that if I deposited my check that day, the money would be available to me within a few hours. I made sure my question was clear and repeatedly asked “when will this check clear.”
A Bank of America spokeswoman did not respond to request for comment.
This is not a new issue. For years Bank of America and other bank customers have been ripped off, in part, because tellers give incorrect information. The next time it happens I hope a lawyer sues the bank for giving out false information. Maybe that will get their attention.
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Several years ago I became a victim of several scams. When I went to the bank I had at the time to deposit and cash several fake checks I was told that it would take several days for it to clear. After several attempts at trying to cash bogus checks, mind you I was told that they were fake. These tellers were trained right. That bank ended up closing my account and my email provider froze my email address. When I came to my senses I began to research scams. I wrote a self-help guide called ‘Scammers Among Us Beware’ published by Eloquent Books. This is a how to , how not to, what to do if, and who to contact if. This book can be viewed and purchased on Amazon.com, BN.com. It is a compilation of data from agencies of the USA, Canada, the UK, and Interpol. Check it out for it just might save you your bankroll. Thank you.
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The latest worrisome trend is for scammers to steal money electronically from your bank account without using checks.
The people who unwittingly handle the stolen funds and pass them on to the scammers are called Money Mules.
See http://blogs.zdnet.com/security/?p=4402
This article shows how people’s computers get infected by viruses, then hackers hijack their online banking logins, and steal money from the victim’s bank account to send it to the Money Mule accounts.
No checks are used in this case. And some of the virus (trojan) programs change the online banking reports the victim sees so that the fraudulent wire transfers do not even appear on the victim’s screen.
This is very scary stuff and should be a wake up call for people to keep their anti-virus up to date. For those who don’t want to pay the $30 – $50 per year charged by the mainstream vendors, Microsoft has just released a free version of its Security Essentials anti-virus program. Other vendors like AVG also provide limited anti-virus capabilities for free.
“The next time it happens I hope a lawyer sues the bank for giving out false information. Maybe that will get their attention.”
1) That will not happen, because at every account opening you are provided with a disclosure that explains everything to the dot. You have to read your disclosures in order to understand these policies and stop blaming banks.
2) Majority of customers who ask “when will the check clear” really mean “when can I start using the money”. Personally, when I give them an answer “the check will clear in about 2 weeks…” before I even finish I see their eyes popping out and more. That’s because customers only know how to ask “when will the check clear”, it’s like a universal phrase for asking when I can use the cash.
Now, instead of going into explaining to them for 5 minutes straight because they get frustrated and become rude I simply say “the check will be AVAILABLE tomorrow morning”. I put the emphasis on “available”. Customers need to stop being negligent and actually read their disclosures for once.
Obviously you don’t deal with the public on a daily basis. It doesn’t take 5 minutes to explain to a customer when a check will be available and when it will clear. This is what I say. The funds will be available to use in 1 or 2 business days depending on where the check is drawn from. It could take up to 2 weeks for the check to clear the other bank.
Tired Of Fees, I applaud you. I think you’ve go the best idea thus far.
It is much simpler an less confusing to give the customer both bits of information and if needed, the customer can ask for more clarity.
And that shouldn’t take more than a few extra seconds.
Thanks.
Acing Team has said it best. Customers all too often if not never read the disclosures for anything they get. The problems arise when something occurs and they come complaining. Everything from Overdrafts, misc. fees, and Funds Availability are all disclosed in the “disclosures”. This is just another example of customers who initially were displeased when banks would hold their money for two weeks, and now it’s pissing customers off because when they deposit non-legit checks they are the ones responsible after pissing the money away before it’s cleared. Take time to read what you are given. Simply put. Nice explaination AcingTeam!
Thanks folks for taking the time to comment. To make my point clearer, I know that disclosure statements bank give out when you sign up for an account have that information. But banks know that no one reads the reams of information and bankers don’t point it out.
The main issue is that tellers are TRAINED TO GIVE FALSE information. When I ask when my check will clear there is only ONE proper and accurate answer: we DON’T KNOW when your check WILL CLEAR – all we can tell you is that your money will be available to you in xxx hours or days and if the check you deposited is no good, we will take the money right back out of your account since the check won’t clear for UP TO TWO WEEKS.
The Dog
George, how do you know that bankers are trained to give false information? Because that is incorrect. I work for a bank and we are asked to explain holds and availability policies at every account opening. Like I explained, most often than not when people ask that question, they are asking when the money becomes available. Most customers flip out after being told “2 weeks” and don’t even let you finish. I find it much easier just saying “the funds will be available in 2 business days”.
Are tellers mind readers? They know that if I am asking for when my check clears it means I do not understand banking terms and i am really asking for when my funds willl be available? If I want to know when my funds are available I will ask that question.
Now, did I say tellers are trained to give false info when people sign up? No I did not. I said tellers – in some banks – including the biggest in the country – are trained to give FALSE answers to the question when will my check clear.
George, I’m glad you are familiar with banking terminology… however, most (if not all) customers are not. You can’t blame everything on banks when customers fail to do their own duediligence on this matter. That’s called negligence.
And again, tellers being “trained” to give false answers to that question is a BIG accusation. It’s not true, it’s not ethical nor is it professional. I’ve worked for many banks and frankly this topic hasn’t been discussed between the tellers. They know what the difference is but they just assume you are asking when the funds will be available. It’s not a subject of fraud like you’re saying it is.
I don’t think you are getting my point. Banks should not assume their customers are ignorent of common banking terms. If a customer asks about a check clearing, the answer should be about a check clearing. Very simple. Giving a different answer because a teller is assuming that a different question is being asked is stupid and can lead to major problems for the customer. Just like Webster Bank, all banks should give correct answers. I don’t know why there is a debate here.
There are plenty of reasons to be wary of banks. They are as an industry, adept at protecting themselves. I must say though, that BAC is not as predatory as might appear. I occasionally assist refugee immigrants in Hartford who have no experience with American banking practices.
They can mistakenly rely on an internet account statement instead of keeping a check register up to date to check the balance. If the online balance is $1800 then they felt they can draw on the account even though $1600 in other checks have been written and not yet deposited or processed. Needless to say this and the Western innovation of identity theft can make it difficult to ‘stay afloat’ for a new arrival to our country from a third world place.
To my surprise, after many years of the call center blues with banks, mortgage companies, insurance, etc., I found Bank of America reps at the branches to be thorough, accessible, and courteous. The branches at Washington Street and at Maple Avenue in Hartford are staffed by
good people who know how to communicate with a wide range of customers from many different ethnic backgrounds.
So yeah, the fine points of available funds as opposed to cleared makes it look suspicious, but I believe based on my experience of seeing the concern the branch people have for the customers of modest means, that it is not a policy geared to dup or trick anyone.
Dogman, banks are going to play good defense in difficult economic times, so they can protect themselves and protect the money intrusted to them. But if you walked in to either of those same branches and found misleading practices was the norm I would be profoundly surprised.
It may also take more than a m,onth for a check to clear the bank. I once received a check for $100.00 from my mother in Boston, I lived in Hartford at the time. I deposited the check & waited. After 2 weeks, the money showed as available in my account. I called the bank and asked it the check had cleared and was told it had. I did not withdraw the money until a month and a half later. To my surprise, two weeks after withdrawing the money, I received a notice from my bank that the check had bounced and I now owed them the $100.00 plus an additional $30.00 for a bounced check fee. When I asked why it took two months to discover this fact, after being told it had cleared, I was simply told that it was my problem not theirs. After that incident, I switched to the credit union at my place of wortk.