Three joint checks with my name, and, let's say Mr. X, were taken out of a joint investment account -- all without my knowledge. I recently found out that all three of these checks were then deposited in a joint checking account of Mr. X and Ms. Z. None of the checks were endorsed by me or Mr. X. "For Deposit Only" was all that appeared on the back of the checks. Is the bank that accepted these deposits responsible for this?
I would think that this would be considered fraud because I had no knowledge of this happening. Now that the money has been placed in a joint account (that does not have my name on it), I no longer have access to the funds. I would consider this stealing. How much money constitutes a felony?
You're really raised two questions with your problem, and we'd like to address them that way.
Missing endorsements
If the checks were payable to Mr. X and you jointly, with the word AND or an ampersand ("&") connecting your names, a bank should not have accepted the checks for deposit without both endorsements unless the checks were being deposited into an account jointly held by Mr. X and you. If, however, the checks were payable only to Mr. X, or payable to you and Mr. X without the word AND or an ampersand, the checks would have been negotiable by either of you without the other, and the bank would have been permitted to accept the checks without endorsement into any account held by Mr. X (including an account joint with Ms. Z).
Withdrawals from the investment account
Your contract with the custodian of your investment account controls who has authority to order disbursements or withdrawals from that account. If the contract permits either your or Mr. X to make withdrawals or disbursements without the other's permission, the investment custodian appears to have acted properly in allowing those checks to be issued. If, on the other hand, your contract requires joint consent for any withdrawal or disbursement from the account, the custodian may have erred (or Mr. X may have fraudulently represented that you had consented). Talk to an attorney to get a thorough discussion of where you stand before taking action.
Published on BankingQuestions.com 6/19/07
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You're really raised two questions with your problem, and we'd like to address them that way.
