A return item, including one for forged drawer's signature, is subject to the midnight deadline. The paying bank had until midnight of the business day following the day of presentment to return those checks. You are undoubtedly looking at late returns.
If the checks were returned to you through the Fed, you can submit a check adjustment claim of late return. If you submit it within the sixty days following the date you were charged for the returns, you should get credit the next day, but be forewarned, the paying bank can complete a disclaimer asserting that did make timely returns (and the Fed won't check that bank's facts or assertions, but will charge you again for the checks).
If you are a member of a check clearing house other than the Fed, the clearing house may have a warranty rule that shifts responsibility for the checks to you, if your customer has any funds left to reclaim. Alert your security officer, if he or she works with check fraud, because these items may still end up on your doorstep!
First published on BankersOnline.com 10/18/10
Returning Forged Checks to Paying Bank
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Question:
Today, 10/6/10, we received multiple checks returned to our bank. They were all from one account at the paying bank, dated June through September. They were returned as forged signatures. I believe the liability falls on the paying bank, as these were not returned by the midnight deadline. What is the proper way to send these back to the paying bank? Do we do a check adjustment and state untimely return?
Answer: