Disappearing deposits: What happens when banks lose your money | Page 3 | General financial discussion | Discussion forum

There is also the possibility of miscommunication.

The actual suggestion to Robinson could have been to ask for another cheque from the buyer. The Scotiabank contact did not understand the lost cheques had been certified.

Robinson asked the buyer. Buyer went to her bank and her bank asked for a $21,000 indemnity bond for the lost certified cheques. That would have cost $400 to $700.

Buyer told Robinson that the bank wanted $400+ to replace the lost cheques! Robinson didn't believe that, knowing that stop payments are around $25 each. She thought the buyer was just trying to take advantage of her predicament.

She waited, hoping that Scotiabank would find the lost cheques. Unfortunately, months later, the cheques were not found.

Bill said
If you're selling a personal item to someone else, a stranger, for $50,000 what is the best way to accept payment? In 2024 is it still certified cheque? Thank you.  

Bank Draft. The bank will debit account. Draft is payable by bank to payee. Certified is weaker/more prone to fraud.

As a former bank teller, I remember that there used to be a guaranteed procedure for cheque acceptance, if there was ever any question as to the authenticity of the instrument. I don't remember the exact terminology, but I think it was called something like 'Clearance'. We would accept the cheque, but then physically send it to the originating bank for clearance. They would then send the money directly from bank-to-bank and only then would it be deposited to the member's account and be available to them. This took a few weeks and would cost the member a few dollars, but it was the gold standard for guaranteed acceptance of funds.

HermanH said
As a former bank teller, I remember that there used to be a guaranteed procedure for cheque acceptance, if there was ever any question as to the authenticity of the instrument. I don't remember the exact terminology, but I think it was called something like 'Clearance'. We would accept the cheque, but then physically send it to the originating bank for clearance. …

That sounds like sending a cheque for collection.

I don't think collection is foolproof either. The drawee bank can easily tell if there is not sufficient funds for the cheque, the account number is bogus, or the writer of the cheque is now deceased.

But, there are other reasons a cheque can be returned for that the bank can't easily detect.

I suspect this particular auto dealer phones the general number for the bank and asks to speak to the specific employee. No one should take a business card at face value.

Yes, naturally one would first call the bank and then be connected to the employee shown on the card.

Thanks, SaverJunior, that's a great idea. (I like to exercise in mornings, would 11 a.m. be ok? Just kidding!)

SaverJunior said

Deposit the bank draft or cash with a teller who could verify no counterfeit right there. The teller will give you a deposit receipt and bear all consequences if any for the transaction. Then hand over the keys to the buyer.
…

Teller can only verify the cash. Teller won't be able to easily verify the bank draft unless it was issued by the same bank. No, teller won't take responsibility. Teller will accept the draft for deposit and put a five-day hold on it, like a regular cheque.

Those counterfeit Bank of Montreal money orders that were floating around town over 20 years ago were very good. A victim took one to a Bank of Montreal branch after it bounced and the teller said a mistake must have been made. It had all the expected security features of a genuine one!

Teller wasn't convinced it was a counterfeit until she tried to retrieve the money order's details using its serial number.

Norman1 said
Teller won't be able to easily verify the bank draft unless it was issued by the same bank.   

There are security features built-in with a bank draft. Teller can check those and as well call up the issuing bank shown on the draft to verify authenticity before deposit.

Alternatively, meet at buyer's bank which issued the draft. If the draft is genuine, you can cash the draft (all $50K if you want) since you are at the issuing bank. Or just deposit it if you so happened have account with that bank.

Bill, if you are selling your Porsche , watch this and beware.

Thanks, SaverJunior, another good idea.

No Porsche involved so I should be safe. I'd seen that video before and what amazed me was the guy popped up like he was a cartoon character, must have been full of adrenaline, pretty sure that would have been the end of me!