I am dealing with a counterfeit Canadian check. The drawee is returning the check late, and is sending it back via the Fed instead of a "without entry" process. The Fed has advised that there is no deadline for returns of foreign (non-US) checks. In addition, the Fed also advised that the return time for counterfeit checks was extended by Reg CC. Has anyone else dealt with this problem?

Yes. We ended up losing almost $17,000. Foreign checks do not follow the same rules as US checks. It can sometimes take up to a month to get them back. That's one reason I advocate sending them all for collection. Until the bank gets their money, the customer doesn't receive their funds.

Thanks. Have you ever heard of the section of Reg CC that allows "late returns" when the check is counterfeit?

I don't think that Reg CC applies to those checks, but if you're dealing with a US check, you can't pull a counterfeit check to return it. The paying bank has the responsibility of reviewing the items it pays and is held to it. Again, it doesn't seem that Reg CC would come into play anyway in your case.

I'm not aware of any provisions in Reg. CC that would govern the right of return - those are governed by the UCC, aren't they?

The UCC rules continue to apply, but Section 229.30 of Reg. CC does modify them slightly.

Thanks to all who responded!