Split Deposit for DDA - New Account Hold (Time Account)

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Question:

A new customer came in and opened a DDA and a 30 month CD using a $100k check from her account at another bank. The CSR opened the accounts with a split deposit and placed a New Account Reg CC hold on the $50k used to open the DDA. The Hold Notice was generated showing the check number as a $50k check. It seems to me the check should have been deposited into the new DDA and the hold placed on the entire check. Once the check cleared, funds could then have been transferred to open a new CD. Although Reg CC does not apply to time accounts, should the teller go back and place the same New Account Hold on the CD so that the entire check is accounted for? I am thinking if this check should come back, it will cause more issues with the CD than necessary. Any thoughts?

Answer:

Since there are no limitations for placing holds on a certificate of deposit, take whatever operational steps are necessary to prohibit any early withdrawals from the certificate to protect the bank from potential loss.

Whether half or all of the funds were initially deposited into the certificate, if the check is returned unpaid the impact on the certificate is the same. Even with rates still near historic lows, as a consumer I would have been taking my check elsewhere if you tried to deprive me of a week's interest by forcing me to deposit all of the check into a checking account before allowing me to open the certificate.