Personal Finance

which bank cheques are crossed cheques ?

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Mar 28, 2005
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Jucius Maximus wrote: When you write the vertical lines, you also write 'A/C Payee' or 'Non-Negotiable' between the cross lines.
This means that the cheque can't be signed over to a third party such as Money Mart, etc.
The "Non_Negotiable" part doesn't make any sense for Canada.

I get a few payments by direct deposit to my bank account as well as a paper copy of those payments in the mail.
The paper copies have "Non-Negotiable" printed on them - that means they cannot be deposited or cashed by anybody, not that the document cannot be signed over to a third party.

BTW - the Canadian financial institutions I deal with stopped accepting "third-party" cheques years ago.
I seem to remember this even on ATM's when one deposits a cheque that way - the cheque has to be made out to the account holder, otherwise the bank will not accept it.
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krs wrote: The paper copies have "Non-Negotiable" printed on them - that means they cannot be deposited or cashed by anybody, not that the document cannot be signed over to a third party.
That's not what the governing legislation actually says but I have to agree with you—"not negotiable" likely carries the same meaning as "void" to anyone working at a bank today. I was always taught to write "for deposit only to account of John Smith" on the back of a cheque, to prevent John from transferring it to another party. Not vertical lines with "not negotiable" on the front.
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Kiraly wrote: "not negotiable" likely carries the same meaning as "void" to anyone working at a bank today.
Agreed - most bank employees don't know or care about the Bills of Exchange act and would likely (but erroneously) think that this voids the cheque.

I stamp the front of any cheques (less than 15 a year; mostly for rent) I write with this stamp to help reduce the risk that someone could cash at Money-Mart. It may at least convince a friendly small claims court judge that Money-Mart shouldn't have cashed it!
Named Payee 2017.png
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Seems the Canadian Bankers Association never heard of a "crossed cheque"
https://cba.ca/cheques-what-you-need-to-know

They simply say this on the subject:
To protect against someone else fraudulently cashing a cheque, John Smith can write “For deposit only to account of payee” with his signature, which ensures the cheque can only be deposited into Jane Doe’s account.
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I stamp the front of my cheques next to the name and address......
Screen Shot 2019-03-12 at 13.34.00.png
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krs wrote: The "Non_Negotiable" part doesn't make any sense for Canada.

I get a few payments by direct deposit to my bank account as well as a paper copy of those payments in the mail.
The paper copies have "Non-Negotiable" printed on them - that means they cannot be deposited or cashed by anybody, not that the document cannot be signed over to a third party.

BTW - the Canadian financial institutions I deal with stopped accepting "third-party" cheques years ago.
I seem to remember this even on ATM's when one deposits a cheque that way - the cheque has to be made out to the account holder, otherwise the bank will not accept it.
Does it? What about "void" what about "not a cheque"?, "Not a check?". While things like this may obfuscate the cheque and demand one question why somebody would even going to the trouble of writing out a cheque never meant to be cashed, I'm not sure the legal force it has in invalidating it. Can I write "not a gun" on a pistol then avoid weapons charges when I carry it into a bank?

I'm not intimately familiar with chequeing law, but I did read a great story about 10 years ago about a guy who cashed one of those 'non-negotiable' cheques, and it was cashed, but because the bank he deposited took way too long to get back to him after it bounced, the bank was legally on the hook for it (though he ended up returning the money as an act of good faith). There are a bunch of things a cheque needs, date, payee, account number etc, and provided they're there, it's a cheque.

https://www.sfgate.com/news/article/Pla ... 588766.php

"Much to his shock, the check cleared ten days later. (As he later learned, the check met the nine criteria of a valid check and the words "non negotiable" printed on the front did not negate it."
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seadog83 wrote: Does it? What about "void" what about "not a cheque"?, "Not a check?". While things like this may obfuscate the cheque and demand one question why somebody would even going to the trouble of writing out a cheque never meant to be cashed, I'm not sure the legal force it has in invalidating it. Can I write "not a gun" on a pistol then avoid weapons charges when I carry it into a bank?

I'm not intimately familiar with chequeing law, but I did read a great story about 10 years ago about a guy who cashed one of those 'non-negotiable' cheques, and it was cashed, but because the bank he deposited took way too long to get back to him after it bounced, the bank was legally on the hook for it (though he ended up returning the money as an act of good faith). There are a bunch of things a cheque needs, date, payee, account number etc, and provided they're there, it's a cheque.

https://www.sfgate.com/news/article/Pla ... 588766.php

"Much to his shock, the check cleared ten days later. (As he later learned, the check met the nine criteria of a valid check and the words "non negotiable" printed on the front did not negate it."
By placing restrictions on a cheque like non-negotiable, you prevent it being endorsed to others, and/or restrict it from being cashed by a third-party. Technically it's still valid for the person named on the front of the cheque. Although many bank employees wouldn't realize this.

By placing a restriction that it may only be deposited into an account - you preserve the ability to investigate and chargeback.

At the same time - by no surprise - no human reads the cheques (especially if depositing via ATM or image) and it's likely anything will clear. But by showing the cheque had a restriction you may win the court case and/or reclaim the money.

PHT
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seadog83 wrote: Does it? What about "void" what about "not a cheque"?, "Not a check?". While things like this may obfuscate the cheque and demand one question why somebody would even going to the trouble of writing out a cheque never meant to be cashed, I'm not sure the legal force it has in invalidating it. Can I write "not a gun" on a pistol then avoid weapons charges when I carry it into a bank?
You are missing the point.
The document I'm talking about is a statement of a direct deposit.
The bottom half of the statement looks like a cheque - it can be separated from the rest of the statement so then it's also in the shape of a cheque and it has printed diagonally across it "Non-Negotiable".
People who get paid via cheque, ie not direct deposit, would get the same statement except in their case, they would separate the bottom third of that statement (it's perforated' and take it to the bank to deposit it.
So in this case "Non-Negotiable" means one cannot deposit and/or cash it; it does not mean that only the person it's made out to can deposit it.
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krs wrote: You are missing the point.
The document I'm talking about is a statement of a direct deposit.
The bottom half of the statement looks like a cheque - it can be separated from the rest of the statement so then it's also in the shape of a cheque and it has printed diagonally across it "Non-Negotiable".
People who get paid via cheque, ie not direct deposit, would get the same statement except in their case, they would separate the bottom third of that statement (it's perforated' and take it to the bank to deposit it.
So in this case "Non-Negotiable" means one cannot deposit and/or cash it; it does not mean that only the person it's made out to can deposit it.
I think it's legally not negotiable, not because "non-negotiable" is written on it, but rather because it doesn't meet the criteria for being a cheque, and it's there for information purposes only. Sort of like the memo portion on a real cheque.

If you played a joke on a friend by writing "non-negotiable" on all the cash in their wallet while they were in the shower, would they truly be out of the money and left with worthless scraps?

Cash is in a sense a fancy form of cheque issued by the gov't. Just that they're a lot more trustworthy than me or you....
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Mar 25, 2012
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I read up on this "crossed cheques" thing a few years ago, and recall the Money Mart issue, but I do wonder whether these "crossed cheques" are even a valid thing in the Bills of Exchange Act (what matters). Why not just write "for deposit only by the payee" on the back of the cheque? That should cover you. Yes, it will prevent the person from cashing the cheque at Money Mart, but people should check with their vendor to see where they get their cheques cashed. If they use Money Mart, tell them you can either: (a) send them an Interac e-Transfer (most banks offer this for free now, in some form), (b) a Tangerine Email Money Transfer, or (c) you'll get them a bank draft they can take to the bank, along with your bank's business card to call and verify the bank draft. If you don't want to pay the bank draft fee, tell them you'll make the bank draft for the amount owed less the cost of the bank draft, which I'm sure they'll happily pay. Problem solved.

I agree, though, most CSRs won't know what a "crossed cheque" is.

If Money Mart is cashing the cheque twice, you have two options:
- have your bank return the second cheque; and/or,
- serve them (Money Mart) with a small claims court action as the second instance is clearly fraud on their part.

Cheers,
Doug
Last edited by dmehus on Mar 16th, 2019 8:46 pm, edited 1 time in total.
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UrbanPoet wrote: Hey cool. Your checks have a custom pic thats the same as your avatar!
Yes; I'm strange. I sort of put it on everything.
sticker.jpg
It's even been known to make it to the office.
IMG_0001.JPG
:-)
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halflife150 wrote: Cross chequing is something you have to do manually, and it is a legal thing in Canada, only problem is the way Canadian Banks cheque clearing process is set up, it might reject the cheques, basically defeating the protection.

Instead of crossing, you can write in the memo field "depositable at a chartered bank, trust company, or credit union in named payee's account only". Seems to work. If you write only a few cheques, then not much of a problem. But if you write a lot of checks, probably best to get a stamp made with the above statement and stamp all your cheques beforehand.
I agree...when I worked at HSBC Bank Canada, we even had an endorsement stamp that read something to the effect of, "for deposit to the credit of the payee only at any bank or trust company," so something like that should work just fine. If any judge didn't see such a stamp as being only depositable by the named payee, then he or she has made a grievous error in law, I think.

I might modify what you wrote a bit and just say:

"For deposit only by the named payee on the front of the cheque only at any federally or provincially regulated bank, trust company, or credit union in Canada"

This would preclude U.S. banks from depositing the cheque, but it's questionable whether U.S. banks even take personal cheques drawn in CAD funds on a Canadian bank anymore. ;)

You could even go one step further with something like:
- "Negotiable by the named payee only. Not negotiable by third parties";
- "Not negotiable by any third parties (including Money Mart and related affiliates)"; or,
- "Not negotiable at, by, or to Money Mart and related affiliates in any way"

Cheers,
Doug
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dmehus wrote: I might modify what you wrote a bit and just say:

"For deposit only by the named payee on the front of the cheque only at any federally or provincially regulated bank, trust company, or credit union in Canada"

This would preclude U.S. banks from depositing the cheque, but it's questionable whether U.S. banks even take personal cheques drawn in CAD funds on a Canadian bank anymore. ;)

You could even go one step further with something like:
- "Negotiable by the named payee only. Not negotiable by third parties";
- "Not negotiable by any third parties (i.e., including Money Mart and related affiliates)"; or,
- "Not negotiable at, by, or to Money Mart and related affiliates in any way"

Cheers,
Doug
These are good ideas.

I struggled over the precise wording on the stamp, but you have only so much room and I wanted it on the front.

I also didn't want the payee to necessarily notice it and be freaked out. :-)
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dmehus wrote: "For deposit only by the named payee on the front of the cheque only at any federally or provincially regulated bank, trust company, or credit union in Canada"
Would that wording exclude ATB Financial, which is neither a bank, a trust company or a credit union, but a special kind of financial institution governed by provincial law?
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airodyssey wrote: Would that wording exclude ATB Financial, which is neither a bank, a trust company or a credit union, but a special kind of financial institution governed by provincial law?
It's probably semantics, in that ATB Financial could still negotiate it. Financial institution might be better, but then that opens it up to Money Mart potentially saying, "we're a financial institution!" Legally speaking, Alberta Treasury Branches could been as a provincially regulated bank.

Could try this:

"For deposit only by the named payee on the front of the cheque only by any federally or provincially chartered bank, trust company or credit union, or by directly by any federal or provincial government body in Canada."

That's getting a bit long, though.

"For deposit only by the named payee on the front of the cheque only at any branch of a federally or provincially regulated and chartered financial institution that is also a member of Payments Canada."

At any rate, payments modernization and "open banking" is starting to move quickly. I now expect Canada to completely phase out cheques by the year 2030 as electronic cash payments replace them (EFTs, Interac e-Transfers, and the like). So, better enjoy your cheques while you can, if you want.

Cheers,
Doug
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hopetindall wrote: Yes; I'm strange. I sort of put it on everything.

Image

It's even been known to make it to the office.

IMG_0001.JPG

:-)
Dude, looking at your current avatar, I'm sorry to see that your hair is receding and you now need glasses. It happens to the best of us...

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