We have a 2 signature account that had some recent fraud by one owner and his girlfriend (not on account), who forged the other owner's signature and cleared out the account with 2 checks written to each other and deposited to another bank. We returned the items late, so now have 2 months where the other bank can come back to us to seek said funds.

Is there any hold available to us for this situation?

I'm not entirely sure I understand the situation, but I would talk to legal counsel. You seem to be saying that items cleared the account with a forged signature for one of the owners; but if you can demonstrate that the items were authorized by the other account owner, you may be able to argue that this is really a civil matter between the two owners--assuming that the depositary bank declines to honor the late return, and you have to address the question of your bank's liability. I would certainly suspend or close your customer's account, pending a resolution.