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Home >> Checks/Money Orders >> Checks You Received
Can Bank Deduct from Special Purpose CDs?
I have a problem with the old bank with which my company used to do business. I closed my checking account with them in June of 2006. We still have two CDs with them though that are security deposits required by the state, for the industry I’m in. I just noticed that two months ago, the bank withdrew $240 from one of my CDs. I have received no notice or documentation as to why they did this. When I contacted the bank, they told me that a check that I deposited in March of 2006 had been returned NSF, but ended up being returned into some random stranger's account. Now that they finally found the error, they took the money back from the only funds we still had with them ... the CDs. I'm curious as to the legality of them taking money from the CDs, but more so I'm concerned about the fact that to this day I have not received the check back, nor have I ever received a notice of the returned item. Does this violate any regulations (J and CC come to mind)? Not to mention the fact that I now have to attempt collection on a check that is over a year old at this point, assuming they can even find the original check for me. I don't know if I should pursue this as a legal matter, or just let it go. The bank is one of the big corporate giants, so I fear attempting legal action.
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 Whether Megabank has legally removed the funds from your company's certificate of deposit account is a matter of contract. Some banks have deposit contract provisions that permit them to offset funds owed to them against any funds owed by them, including CD accounts.
You may have a case against Megabank for losses caused by its failure to provide prompt notification or to return the check to you (so that you could pursue the drawer on its obligation to you). However, if you don't get quick satisfaction from the bank, we also agree that it may not be worth it to pursue this issue in the courts.
Published on BankingQuestions.com 4/17/07
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