Banks & Bad Checks

[Ash]

My buddy Jason had an unfortunate thing happen to him a couple of weeks ago.

He's been talking to/seeing this girl for a short while and she managed to find his checkbook while rifling through the glove compartment in his truck.
Without his knowledge, she took a blank check from it and the next day she wrote it out for $1,100 and forged his signature.
She then had her girlfriend go to his bank and cash it.

A few days later he checked his bank balance at an ATM and saw that he was -$650 in the hole.
Needless to say, he went ballistic.

The bank made a copy of the bad check and gave it to him.  He showed it to me and the signature at the bottom right of the check isn't even close to his.

The problem is that he's been having a heckuva time getting his money back.
He pressed charges against her and has the police report but the bank is making him go through an unusual amount of red tape and is kind of giving him a hard time about it.  After 2 weeks they're now saying he'll have to talk to the regional manager. (why he has to talk to the regional manager, I don't know...he never explained why)

He's p**sed off because he feels the bank never should've cashed the check in the first place.  I agree with him...they never should have cashed it.

I've banked at other banks who have heavy security measures in place to prevent this sort of thing.  Some banks have signature cards that you are required to sign and if the check is over a certain amount they check to make sure the signatures match.
Other banks will simply refuse to cash a 2-party check if the person attempting to cash the check doesn't have an account there.
This girl was able to walk into his bank, present the forged check and they handed over the money to her just like that.
You'd think they'd be suspicious especially because cashing it put his account into overdraft.

He was asking me if I had any idea as to what he could do and I told him I didn't really know.  Nothing like that has ever happened to me.
He's thinking of suing the bank but I told him I didn't know if he'd be successful because banks are pretty powerful institutions who have good lawyers on their side.

What are his options?
About how long do you think it'll take to get his money back?
Do any of you know what the legal charge for forging a check for that amount is?  (1st degree theft?  2nd degree theft?)
Will they charge her with both theft and forgery?

[dean]

   What tightwads.   What legal basis do they have for not giving him the money?  I wouldn't know how things work over there and I've never used cheque personally, so I don't know the ins and outs here, but essentially if anyone comes into my store and buys something with a cheque I always ask them to present me with a legit photo ID such as a drivers license/passport and I take their license number, address and contact number just in case it turns out to be a bad cheque.  So far no issues as far as I know.

Your friend's situation sucks, she sounds like a complete deadbeat! 

[RCMerchant]

I have had my account robbed....but it was as a result of Tata Sue using my account # to buy stuff online....and the sleazy company's proceeded to drain my account. I put a hold on it through the bank,and after much ado,I was partialy refunded. But I will NEVER give out my account # to ANYONE ever again!
 The bank should have NEVER cashed the check...I would advice your freind to do buisness elsewhere. The bank should be held accountable for it's poor protection of it's clients. After all-thats their job...to protect YOUR money. YOUR money makes them money. Much like polititions....bankers think we serve them....not they serve us.

[CheezeFlixz]

Without his knowledge, she took a blank check from it and the next day she wrote it out for $1,100 and forged his signature. She then had her girlfriend go to his bank and cash it. A few days later he checked his bank balance at an ATM and saw that he was -$650 in the hole.

First of all if she cashed it at his bank, and the check was for more money than he had in the bank, I find it hard to believe a bank would cash a check that was on a account for more money than that was in the account. Banks just don't do that.
In short no bank, no place will cash a check for more than the account has in it, ever. If you present a check at a bank the check is drawn on, and it's for more than is in the account the teller will say "Sorry, this account cannot cover this check." ... if you try to cash it at another bank as a general rule (at least around here for checks over $500) if the bank doesn't have electronic verification then the bank will call the bank the check is drawn on to verify available funds.
It's like a debt card, if someone go to the store and use a debt card and try to debt more than they have the transaction is declined.

If I write a check to someone for work, regardless of the amount as soon as they go to their bank be it the same bank or a different one and they cash/deposit it, it will show up on my account within minutes that I can see online as a pending transaction, securing those funds to cover that check. The funds are secured but do not leave my account until the back has the check in hand.

No bank check signature cards are ever looked at again after you sign them. I've had banks cash checks I written and forgot to sign at all.

His girlfriend, friend cashed the check? Who was it made out to? Most banks and places will not cash a third party check.  and photo ID are required for large checks unless you are known to the bank.

After all-thats their job...to protect YOUR money.

Sorry RC, it's not. They protect their money, your money is protected by you and the FDIC (up to $100K), which is you the tax payer. The only person that's truly got your back is you.

That's why a bank will not cash a check for more than the account has, anything over gets into their money.

[RCMerchant]

A bank WILL cash a check more than that is in your account...it's called an OVERDRAFT....and they will fine you and continue to penalize you for every day it is overdrawn. It's called Writing a Bad Check. But to withdraw directly from your account....in person...? Naw.
 I do find it hard to swallow that ANY bank would cash a third party check,though,without verification. Methinks Ash's freind's girlfreind may have used his account # to pay for whatever online,or over the phone. 
 

[CheezeFlixz]

A bank WILL cash a check more than that is in your account...it's called an OVERDRAFT....and they will fine you and continue to penalize you for every day it is overdrawn. It's called Writing a Bad Check. But to withdraw directly from your account....in person...? Naw.
 I do find it hard to swallow that ANY bank would cash a third party check,though,without verification. Methinks Ash's freind's girlfreind may have used his account # to pay for whatever online,or over the phone. 
 

Right is a check is out and comes in, some backs will cash it. A overdraft is basically the bank spots you the funds and then hits you with fees. Most banks will not cash a check if the money is not there and send it back as "insufficient funds". Then they'll hit you with a fee for that and the place that you wrote the check on will hit you with bad fee check fees and if it goes the the DA's bad check division they'll hit you with fee's for collection.

But if you walk into a bank to cash a check and the money isn't in the account, they will not cash it, ever.

[AndyC]

In my experience, the bank has reversed payment of the cheque. I once pressured a guy to pay money he owed me, so he wrote me a cheque. I cashed it, and the following week, my account was in overdraft and I was being penalized. The money had been taken back. Somehow, I was responsible for this guy's bad cheque.

[sprite75]

He should also call the regulatory agencies and open cases with them on this bank, then keep on these regulatory agencies to do their jobs.

[Rev. Powell]

My buddy Jason had an unfortunate thing happen to him a couple of weeks ago.

He's been talking to/seeing this girl for a short while and she managed to find his checkbook while rifling through the glove compartment in his truck.
Without his knowledge, she took a blank check from it and the next day she wrote it out for $1,100 and forged his signature.
She then had her girlfriend go to his bank and cash it.

A few days later he checked his bank balance at an ATM and saw that he was -$650 in the hole.
Needless to say, he went ballistic.

The bank made a copy of the bad check and gave it to him.  He showed it to me and the signature at the bottom right of the check isn't even close to his.

The problem is that he's been having a heckuva time getting his money back.
He pressed charges against her and has the police report but the bank is making him go through an unusual amount of red tape and is kind of giving him a hard time about it.  After 2 weeks they're now saying he'll have to talk to the regional manager. (why he has to talk to the regional manager, I don't know...he never explained why)

He's p**sed off because he feels the bank never should've cashed the check in the first place.  I agree with him...they never should have cashed it.

I've banked at other banks who have heavy security measures in place to prevent this sort of thing.  Some banks have signature cards that you are required to sign and if the check is over a certain amount they check to make sure the signatures match.
Other banks will simply refuse to cash a 2-party check if the person attempting to cash the check doesn't have an account there.
This girl was able to walk into his bank, present the forged check and they handed over the money to her just like that.
You'd think they'd be suspicious especially because cashing it put his account into overdraft.

He was asking me if I had any idea as to what he could do and I told him I didn't really know.  Nothing like that has ever happened to me.
He's thinking of suing the bank but I told him I didn't know if he'd be successful because banks are pretty powerful institutions who have good lawyers on their side.

What are his options?
About how long do you think it'll take to get his money back?
Do any of you know what the legal charge for forging a check for that amount is?  (1st degree theft?  2nd degree theft?)
Will they charge her with both theft and forgery?

First, assuming the facts are exactly as you state them, your friend is not liable for a stolen and forged check (unless he was negligent in storing the checks, which seems unlikely).  See UCC 3-401(a) (Iowa: Iowa Code 554.3401(1)). 

If it were me I would make a copy of the statute and take it to my meeting at the bank, or write a letter citing the statute.  I would ask them why they were delaying re-crediting my account.  I would suspect that they know I'm not liable on the check, they're just jacking me around and waiting until the last possible moment to credit my account. 

I would threaten to take my business to another bank that treats its customers with respect and see how they respond.  If they made me a VERY nice offer to keep me a satisfied customer, I MIGHT stay with them, but probably not. 

I would assume that the bank doesn't want to be sued on an open-and-shut case and will cave if I show them that I understand my rights and am firm in asserting them.  Their staff lawyers could be put to more productive use then traveling to small-claims court to defend a case they can't possibly win.  I would assume that they are relying on the customer's presumed ignorance.

The bank has a right to collect the money from the forger, if she's solvent and can be found.  It would probably cost them more to collect from her than the check is worth, though. 

Iowa Code 715A.2(a)(1)(d) says that forgery of a check is a Class D felony.  She could be charged with larceny (theft) as well; they're two distinct offenses.  I don't feel like looking up anymore of the Iowa statutes; if your friend is interested in doing some research on his own here's the link to the criminal title of the Iowa statutes.

None of the above constitutes legal advice.  It's simply links to the statutes that appear to be relevant, and a statement of what I would do in your friend's situation.  A lawyer would probably handle this case in 15 minutes by writing a letter, but that would still be expensive for your friend.

[ghouck]

Try the Better Business Bureau, worth a try since it's free and done online.

I had some overseas scammer jack me for a couple thousand dollars, I got a hold of someone that works at me bank (on a Sunday evening) and they told me not to worry, a few minutes of paperwork and they'd have my money back in a day or two, and believe it or not, they were 100% correct. They did b***h a little about me using paypal though.

Yea, it's a BS gig, sounds like the bank is being a PIA about it. From my experience though, if you don't keep a decent amount of money in their bank or have a loan with them, they really don't care if you go somewhere else or not.

[Jack]

You might even contact a lawyer and have them contact the bank and express a willingness to take the case to court - I find that threatening legal action has a way of cutting through a lot of BS.  Assuming your friend could find a lawyer who would do that for a reasonable amount of money.

[AndyC]

A lawyer doesn't usually charge much to send a threatening letter. At least mine didn't on the one occasion I needed it done. Tends to get pretty quick action because even if you don't have a leg to stand on, the company would spend a lot of money to prove it. If you're in the right, then they have no reason to spend potentially thousands on a dispute over a few hundred.

[Rev. Powell]

I should add a few things regarding my previous post:

There are probably banking regulations that allow them a reasonable time to investigate an allegation of forgery.

It occurs to me the bank is probably concerned that your friend is faking it--have girlfriend forge check, get money, report check stolen/forged, and they want the face-to-face interview to check out his demeanor.  A customer-friendly bank wouldn't treat its account holders as if they were criminals without some kind of reasonable suspicion, though.

It can't hurt to ask a lawyer to do it for free.  Some firms might do it as a loss-leader to encourage goodwill, or might apply the time spent to fulfill their pro bono obligation.  He might have to hunt around to find a willing attorney.

It's always best to write a letter, but your friend could do it in person if the meeting is scheduled soon.

When writing a letter or confronting someone over a dispute like this, always be firm and confident in asserting your rights, but never, ever be rude or angry.  People will resist you if you come off like a jerk, even if they know you're in the right. 

[Ash]

It occurs to me the bank is probably concerned that your friend is faking it--have girlfriend forge check, get money, report check stolen/forged, and they want the face-to-face interview to check out his demeanor.  A customer-friendly bank wouldn't treat its account holders as if they were criminals without some kind of reasonable suspicion, though.

I've wondered several times myself if my friend was telling me everything there was to know about the situation.
I know he wouldn't steal or try to do some kind of scam against the bank.  He's not the type of person who would do something like that.
But I just can't shake the feeling that he hasn't told me everything.

By the way, karma to you Rev. for looking up that Iowa legal stuff for me.  Thanks!