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*** has no significance for assessment purposes because a cash management relationship exists between this account and the current outstanding checks, account no. First, do preissued, postdated cashier's checks meet the definition of "deposit"? SUMMARY CONCLUSIONS *** preissued, postdated cashier's checks do not meet the definition of "deposit" until their due date. Preissued, postdated cashier's checks do not meet the definition of "deposit" until their due date. In addition, a preissued, postdated cashier's check is not an "outstanding draft" for purposes of what is a "deposit". Finally, since preissued, postdated cashier's checks are not deposits until their due date, *** pension pay service fund, account no ***, is not a deposit account.Second, is *** pension pay service fund, account no. Furthermore, *** pension pay service fund, account no. Therefore, the exception to *** deposit assessment is incorrect. DISCUSSION The assessment base of a bank is "equal to the bank's liability for deposits . Section 3(A preissued, postdated cashier's check is not any one of these four instruments. A "draft" is a negotiable instrument if it is a "direction to pay" a person who is identified with "reasonable certainty". The existence of this account and *** premature posting of these pension checks confuses the assessment process, but substance should rule over form. ADDENDUM *** practice of honoring these postdated cashier's checks has no legal significance for assessment purposes because it does not accelerate the negotiability of these drafts.Preissued, postdated cashier's checks are not cashier's checks or issued officer's checks until the date they become payable. And as a matter of substance, *** pension pay service fund, account no. In other words, *** practice of honoring these drafts before the payment date should not affect *** right to refuse payment before the pay date.Indeed, until the due date, a preissued, postdated cashier's check is not even a "check" as defined by the Uniform Commercial Code. Furthermore, *** practice does not affect the fact that these drafts pose no deposit insurance risk to the FDIC until the payment date. Since these drafts would not yet be negotiable, the payees could not collect payment from the FDIC.In the FDIC deposit assessment audit of December 1986, the FDIC took exception to the pension pay service fund, account no. Furthermore, the FDIC included *** preissued, postdated cashier's checks in the assessment base.In light of *** protest of this assessment, you asked whether or not preissued, postdated cashier's checks are assessable where they are posted to the bank's general ledger on the release date. THE FDIC's POSITION The FDIC's argument essentially is that these preissued, postdated cashier's checks are deposits, and they consequently are assessable. In addition, the payees of *** postdated cashier's checks are on notice that the instruments are not negotiable until the due date. Furthermore, and unlike a preissued, postdated cashier's check, a money order is an effective obligation without restriction on the payment date.

Accepting a check that is postdated may provide the tenant with a legal defense that negates criminal intent even if the check doesn't clear.

If *** failed before the payment date of these preissued, postdated cashier's checks, the rights of the payees would be frozen as of the failure date. Finally, not even *** practice of prematurely honoring these drafts would enable the payees to prematurely collect from the FDIC.

Even if a "course of dealing" relationship were deemed to accelerate payment, such an "agreement" would be unenforceable against the FDIC because there is no written agreement that *** will prematurely pay on these drafts.

Furthermore, *** has asked for a refund of what it asserts is an overassessment in the amount of 8,000. BACKGROUND This protest involves *** pension payment service.

*** has a section in its trust department called the "Benefit Payment Services" which sends out official checks to pay pension trust account beneficiaries.

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