Multiple Presentments of an NSF Check

Question: We had a check come in through the exchange for payment, and we bounced it NSF. It came in the second time, and this time we stamped it, as we always do on second presentment, "Do Not Present Again." We've now had the check presented, in person, in our branch office. There is now enough money in the account to pay it. Do we honor the check or not?

Answer: A long time ago, when banking was young, the Federal Reserve Bank decided it would not handle a check more than twice. Checks were hand sorted back then, and if the clerk noticed the check had gone through the exchange before, and was coming through the second time, they stamped it with a star, and "Do Not Present Again". It became a custom in many financial institutions to follow suit. Now, it means nothing at all. If you were to send a check through the mail for collection with instructions to try for 30 days, the collection department will try every day, and on the day that it's good will grab the money and send you a cashier's check. Same thing for the fellow coming through your door. He can try as many times as he wants to, until the money is there. Short answer? Yes - you honor the check.

Copyright © 2005 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 15, No. 6, 7/05