Looking to opinions on how UCF items are being handled.

a customer of mine deposits an item, i send for clearing, paying bank returns uncollected funds instead of NSF or some other reason.

why would i not charge back to my customer? am i missing something in your question?

Also, polls do not work in the threads. Unless you have a hold harmless agreement with the deposit customer, you should never just be rerunning items without telling them.

Clarification on this question. Item was deposited by your customer and it was returned by the paying bank as UCF. With NSF items, my bank automatically redeposits to attempt to collect for the customer but for UCF they change the account and mail it back to the depositor to redeposit at a later date. My question is do other banks do this? I would think that knowing that there are funds just not yet available, we would redeposit right away vs an NSF item where we know that there wasn't money.

I know this is a business decision just trying to see what others do as we consider why we do things.

Randy's point stands. You customer may not want the item automatically resubmitted and without an agreement with the customer to do so, you could find yourself in legal trouble.

Consider that the maker of the check may have already contracted your customer to let them know the check was dishonored and they made other payment arrangements. Your customer agrees not to redeposit the check but you do so without their knowledge causing harm to the maker of the check. You could find yourself on the hook for damages if any of the parties sues the bank.

Whether other banks are doing this or not doesn't make it any less wrong to do.

Shea, I think re-running checks returned for UCF is just as dangerous, if not more, than a check returned for NSF. What if the check writer is kiting and the whole kiting scheme collapses while you are busy re-running checks that the depositor is unaware of having been returned and is therefore unable to take any other action to collect funds owed?

229.33(h) Notification to customer. If the depositary bank receives a returned check, notice of nonpayment, or notice of recovery under § 229.35(b), it shall send or give notice to its customer of the facts by midnight of the banking day following the banking day on which it received the returned check, notice of nonpayment, or notice of recovery, or within a longer reasonable time.