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Home >> Accounts >> Checking Accounts
Cashing a Check for Someone Gives a Big Problem
A couple weeks back, a friend asked me to cash a check that he had taken for a motorcycle sale because he didn’t have a bank account. Not thinking anything about it, I went to the bank, cashed it, and I gave my friend the $200, the amount of the check. Yesterday, I just happened to logon to my account. I was shocked to see a negative balance of $400.
After scratching my head a while, I noticed that a $200 charge was assessed at the time I cashed the check, along with a $19 fee for a returned check. Additionally, every check I had written since then bounced, as I didn’t have an extra $200 in my account, and fees of $37.50 were charged for each check.
These checks had cleared days ago. How can they go back and charge me insufficient funds for them? I can see how I might be responsible for the $200, but not the overdraft fees associated with checks that had already been paid. The bank manager said that there is nothing to do but pay the fees.
What should I do besides ask my friend to give me the $200? Is there someone to whom I can speak? I am going to give the bank the $200 today, as I just found out last night the check was bad, but I don’t feel as I should be assessed fees retroactively. I think this is fraud…am I right?
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 Assume that your bank placed a hold against your available funds at the time it cashed the $200 check for you. That may have driven your account negative, on an available funds basis, and the bank apparently accrued overdraft fees for each check it paid against your account, and then actually posted those overdraft fees once the $200 check came back. It appears that your checks didn't "bounce," since they were paid.
The bank could have reviewed your checks against the insufficient available funds, due to the hold, and decided to bounce those checks and assess a fee for returning them unpaid. However, it sounds almost like the bank not only paid those checks, it was holding off on posting the overdraft fees until it knew whether the motorcycle check was paid. If that's true, it is more generous than many banks would be, and it doesn't seem as if there's fraud in this situation.
It would be fair of you to ask your friend to share some of the burden of those overdraft fees. After all, it was the favor you did for him that seems to have triggered all of them. It would also be reasonable for you to ask the bank to make some concession on those costs, but understand that there's nothing that compels the bank to do so.
Published on BankingQuestions.com 9/04/08
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