Is there a time limit on a check to clear? I wonder because I received a bank draft from a canadian bank and deposited in a US bank. The us bank is a local only bank.

Forgot to ask, am I liable for the check if I do not get notified within the time limit of the check clearing.

There is no time limit on how long it can take a check to clear. I have seen checks come back to my bank (unpaid) 3 weeks after the deposit, this is not terribly uncommon.

YES, you are responsible. You claimed responsibility for that check the day you deposited it into your account. If it comes back (today, tomorrow, or in a month or year) the amount will be debited from your account.

To gain any kind of assurance that the check has cleared the bank (assuming it is a bank check) your best bet is to call the bank it was drawn off of and find out its status.

Probably not what you wanted to hear, but at least now you're aware.

Canadian checks are not bound by US laws and I have seen them take over a month to come back. Please be careful.

Was it a "Canadian Lottery" check?

I hope they sent it for collection

We just had a customer that deposited a large Canadian check, waited 2 weeks, wired 80% of it to the scammer, and then is taking a loss on the returned counterfeit check that came back in 3 weeks. They thought they were protecting themselves because we have convinced our depositors that checks clear quickly.

It is too bad that the US can't make a deal with Canada regarding expeditious returns.

Wow! Lots of replies. Thanks for the help. But, this brings to mind another question.

Is there a time limit of such for a US check deposited in a US bank? I have heard that it is like 10 days. After that, nothing can be done about it.

I ask because of the story at this link.
http://www.goodthink.com/writing/view_stories.cfm?id=11&page_id=2

1) There is no ten day rule, never has been.

2) Thanks for the link. That's the longest rationalization of stealing I've ever read. However, it's important to for everyone to remember that some people can steal and rationalize it. However, only the truly committed can acknowledge that they did it and turn it into a cottage industry.

Nice link. By the way, I've read this and he didn't get to keep the money.

Is there a link somewhere to show the outcome of this story? My goodness.....he's got some nerve!

We had a counterfeit check (I know it was counterfeit, we had 3 just like it, same check number, same amount, same date) that was deposited into an account, we put a hold on the money, the check took over 6 weeks to be returned, I was beginning to think the check was never going to returned.

In cases like that, Armac, I always call an officer at the bank it's drawn on and bring it to their attention. That usually speeds things up.

We were not that concerned about it, it was misrouted by Fed. But we were curious.

Armac, excuse me. If you knew it was a counterfeit, why was it accepted for deposit instead of being confiscated as such and the customer informed.

Is there mor4e to the story that we are not aware of?

... or why weren't the checks sent for collection instead of being deposited in the account? Since the checks were deposited, how long do you intend to keep the funds held before you release it?

It's my understanding that fraud and counterfeit items can be returned much later if necessary. Also, signature related items have something like 3 years. (though I am not the guru on this site)

smc- maybe I'm out of the loop on this particular thread, but the only items that can be returned much later are postal money orders and treasury checks. If a check is counterfeited, banks still are under the midnight rule to return.
The three years comes into play if there is a forged endorsement of the item and I believe if the check had been altered (where the signature is actually legitimate but the payee and/or amounts have been changed). I want to say altered's have a year for recourse but I can't exactly remember.

SC-That's true for checks...However, Payable Through drafts do not have to be returned by the midnight deadline and can come back way late and for any reason.

That is not a correct statement. Payable through drafts are subject to the expedited return deadlines and should not be coming back "way late for any reason". If they are returned late, you should protest them like any other late return item. See Reg CC reference below:

Sec. 229.36 Presentment and issuance of checks.

(a) Payable through and payable at checks. A check payable at or through a paying bank is considered to be drawn on that bank for purposes of the expeditious return and notice of nonpayment requirements of this subpart.

i have somewhat of a related question.
my friend wrote in a e-mail-
"I don't know if it's nationwide but checks in California clear almost instantaneously after deposit. It's some law they decided to pass this year."

does anyone know if this is true?

Check 21, which became effective Oct. 28, 2004 allows for substitute checks to be legal replacements for the actual check you wrote. This replacement document now paves the way for banks to clear checks electronically. However, it is a huge investment in technology and not many banks are entering the fray.

For the "instantaneous" clearing, every stop along the way of check clearing has to be electronic. The merchant, the bank of first deposit, any intermediary bank, and so on.

It can happen and someday it will, but not anytime soon.

The reference to prolonged clearing time may have something to do with the fact that the original post in this thread referred to cross-border checks drawn on banks in Canada. Canadian banks, of course, are not subject to U.S. laws (except for any U.S. branches of those banks).