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Home >> Checks/Money Orders
Requirements for Dealing with a Check
In New Jersey, what is the UCC requirement for a paying bank to either pay a check presented or return it NSF, stop pay or other within 48 hours?
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 The applicable sections of the New Jersey Uniform Commercial Code call for return by the bank's midnight deadline. That means the check should be on its way back to the depositary bank by midnight of the banking day that next follows the banking day on which the check was presented for payment.
To illustrate, assume that the check is received with others on Monday, a business day for the bank. The bank's staff are notified of, or have an opportunity to determine, a condition for which the check should not be paid on Tuesday, the next banking day. Such conditions include the lack of an authorized signature or existence of an unauthorized signature (if detected), an effective stop payment on the check, insufficient funds to pay the check, encoding and presentment for an amount not in agreement with the actual amount of the check, etc. The bank must return the check on Tuesday before midnight, or become accountable for the amount.
Published on BankingQuestions.com 10/15/09
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