Answer:
“Refer to Maker” is a poor excuse for a return reason, and it tells no one anything about why the check was returned. Often, it’s used when the paying bank is attempting to pull a “fast one” and return an item late, or simply can’t figure out the correct return reason to give.
In this case, the “maker” of the check is the bank that returned it. Because a bank can’t refuse payment on its own cashier’s check except in very limited circumstances, the depositary bank can assist its customer by making an inquiry into the real reason for the return. It may simply be a belief that the payee’s endorsement wasn’t provided or isn’t legible (neither of which is really a reason to refuse payment, in my opinion), but it could be something a bit more weighty. Once the real reason for the return is known, the depositary bank and the payee will have a better idea of how they may proceed to enforce the check against the issuer.
First published on BankersOnline.com 5/30/11
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