Ok, here is my predicament....one of our commercial deposit customers issued a check to someone in 2012. That check was lost and a replacement check was issued at that time, and paid shortly after being issued.

Now the original check from 2012 has been deposited (not at our bank, it came in through cash letter) and paid on our customer's account last month. They noticed it when they received their monthly statement, and then brought it to our attention.

Is there any way that we can return this to the bank that accepted this very old check for deposit? Since it came in by cash letter the date on the check was not seen by anyone here until our customer brought it to our attention. But we are well past the usual 24 hour return window for checks. What to do, what to do...any thoughts would be appreciated.

I'm not a Guru but from what I have seen it looks like your bank is most likely out of luck.

I believe post dated and stale dated checks are a best efforts kind of deal in regards to not negotiating them.

The bank is not out of luck, the customer is. Review your depositor's agreement and any agreement that is even the slight bit current will place the burden on the customer.

is there anything our bank can do? Yes, you can counsel your customer about putting a permanent stop payment on an item "lost." And further explain that their recourse is against the person depositing the check.

If your bank, like most, doesn't accept "permanent" stop orders, you should remind customers placing stop payments that they expire (generally in 6 months) and have to be renewed unless the customer is willing to accept the risk that the check may be negotiated after the stop order has expired. Those customers also should be reminded that there is no such thing as a check that is too old to be paid against an account that is open, since dates are simply not checked in today's banking environment. Your bank has to do risk-based decision making all the time; your customers should do the same when it comes to old checks and stop payment orders.

Isn't there also a legal standard that the bank of first deposit is the one that has the best chance at stopping this type of action and therefore accepts some portion of the responsibility.

We had the same thing happen at the bank that I work at. Our customer wrote three checks to a business in May of 2013. The business went to their local bank to deposit the checks and "oops" the teller didn't catch that the checks were stale dated.

Our operation department called the other bank operation department and they agreed to accept the return.

Neither parties were happy about the situation... In fact, our customer at the time of the situation, is now our former customer. He stated that checks were automatically no good after six months and we should have never let the checks cleared his account. He knew this because he called FDIC, our state bank department and someone high up in Washington D.C and that is what they told him....

There is no such standard of which I am aware. A paying bank always used to be responsible if it paid a check that was stale-dated, back decades ago when a check over 6 months old wasn't properly payable. Now it only has the burden of payment in good faith. The risk was deliberately and knowingly shifted by state legislatures to the issuer of the check.

That's either a load of manure or true, or somewhere in between. I would not at all be surprised to learn that some regulators aren't aware that the UCC was amended -- the UCC, after all, is not their area of expertise. And I'd never rely on a nameless "someone high up in Washington" as a credible source for anything.

One wonders how many generation of the American public have to go by before the current law is as ingrained in their collective consciousness as the old law seems to be today. It would help (I pontificate from my ivory tower) if banks included clear and accurate statements in their deposit agreements concerning post-dated and "stale" dated checks. and made sure that new customers actually SEE those statements.

Thank you to everyone who took the time to answer this. We will probably end up being the loser in this situation, because the business that issued the check is a long standing customer with several large deposit accounts, and the powers that be will not want to tick them off. Was hoping maybe we could return it as stale dated to the original bank that accepted it, and we may at least attempt that, but I assume they will decline to accept the return, and it will end up with us again.

This game is all about setting customer expectations. You may not be able to win this one, but do you have any regular customer communication -- a newsletter, perhaps, that goes out periodically, or gets featured on your website? That could be a good place to start getting out useful and important information like this.

Yes, we do. Thanks, that's a great idea.

UCC Section 4404 gives a bank the right to pay a check, in good faith, which is presented for payment more than 6 months after its date.

It is common for most banks' Account Agreements to include language that it will pay a check if it is presented for payment more than 6 months after its date unless the customer has an outstanding stop payment order on the check. You should check your Account Agreement to see if it includes this language. If your Account Agreement includes this language then you can tell your business folks that your bank properly paid the check and your bank disclosed this to your customer.

If your business folks want to take the loss for customer relations, then you should consider telling your customer that on a go-forward basis you will pay "old" checks unless the customer has a stop payment order on the check.

A-men to ^^^^. And further, the banks that do include that sort of language in their Account Agreements often add language making it clear that a stop payment has an effective period of _________, and if it's not renewed by its expiration date, the bank has no responsibility to refuse payment.