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Home >> My Bank Said ...
Should I Cash a Check or Deposit It?
Is there a difference between cashing a check and depositing one in an account? I received a [bank] check when I sold my car, so I took it to the bank to cash it, which they did. A week later, my joint checking account was charged the amount of the check I cashed, claiming fraud or NSF or something. Well, I bought another car with the cash and don't have the money or the original car. I tried to track down the guy who bought my car from the info on his check, but come to find out, that dude isn't the guy who bought my car! Its all very ugly and I'm involving local law enforcement, but I don't understand how the bank can penalize my account when I didn't deposit the check. Can you help me understand?
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 In this case there isn't much of a difference between the two transactions. Your bank provided you with the proceeds of a check that was payable to you.
The owner of the account later said that was not an authorized check. For him to get his money back, his bank went to yours and said the check was not valid. Your bank gave them back the money. Now your bank turns to you and asks for the money back. They can take it from a deposit account you have with them, or ask you for it out of other assets you have, which is what they have done. If you want to recover your money, you need to find the buyer and ask for cash or the car. It sounds like that was the con man, and you may have your hands full. A call to your police department may be in order. It is possible that rather than taking a loss, your bank could make you a loan or work out some other payment arrangements.
Published on BankingQuestions.com 8/09/08
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