We have 2 different Corporations with the same Officers, they are depositing these checks into each others accounts.
ABC - DEF - GHI (GHI doesnt have an account with us in their name but ABC and DEF are depositing GHI's checks)

ABC is depositing checks pay to DEF
DEF is depositing checks pay to GHI
ABC is depositing checks pay to GHI
DEF is depositing checks pay to ABC

now the President of the Corporations (Mr. XYZ who is the presidnet of the two companies that do have accounts with us) wants to know why he cant deposit checks in this manner. The checks are not being endorsed properly either. To me it is common sense to deposit these checks into the proper account.

I need help explaining this to the customer.
HELP!

Your contracts are your deposit agreements or signature cards on each account.

Your contract with ABC on their accounts does not include DEF or GHI. Same with DEF. GHI is not a customer and you have not verified their identity through your CIP process.

I find it easier to substitute corporations with people.

ABC is Mary
DEF is Jane
GHI is Harry

Mary cannot deposit checks payable to anyone other than Mary in her account. Same with Jane. Harry isn't a customer or an owner on any of the accounts, so you would not accept checks for deposit to Mary or Jane's account that were payable to Harry.

Additionally, you would be allowing an entity that is not your customer to use your bank to clear checks. You do not have an account with this company, have not conducted CIP or any CDD on this company, yet they would have access to your bank.

You know nothing about that non-customer, including who else is an owner. The person depositing the checks could be taking funds from that company, defrauding the other owners.

These entities are separate legal entities and must conduct business separately. There are prior threads on this topic discussing this issue in more detail in the general forums.