On 9/11 we learned how vulnerable our country was when planes, trains and automobiles could not get into New York City, nor could checks clear. This new law will allow financial institutions to clear images of checks through the banking systems without depending upon old modes of transportation. What this means for you is that your check could clear in the time it takes to send a digital picture through the computer along a phone line.
We will also see a new item called a "substitute check" which is a printed copy of your check after it has been imaged. See our disclosure for details on substitute checks and your rights.
Be prepared to face, decreased float times in the months to come. This is part of a continued effort for homeland security.
Substitute Checks and Your Rights:
What is a substitute check?
To make check processing faster, federal law permits banks to replace original checks with "substitute checks." These checks are similar in size to original checks with a slightly reduced image of the front and back of the original check. The front of a substitute check states: "This is a legal copy of your check. You can use it the same way you would use the original check." You may use a substitute check as proof of payment just like the original check.
Some or all of the checks that you receive back from us may be substitute checks. This notice describes rights you have when you receive substitute checks from us. The rights in this notice do not apply to original checks or to electronic debits to your account. However, you have rights under other law with respect to those transactions.
What are my rights regarding substitute checks?
In certain cases, federal law provides a special procedure that allows you to request a refund for losses you suffer if a substitute check is posted to your account (for example, if you think that we withdrew the wrong amount from your account or that we withdrew money from your account more than once for the same check). The losses you may attempt to recover under this procedure may include the amount that was withdrawn from your account and fees that were charged as a result of the withdrawal (for example, bounced check fees).
The amount of your refund under this procedure is limited to the amount of your loss or the amount of the substitute check, whichever is less. You also are entitled to interest on the amount of your refund if your account is an interest-bearing account. If your loss exceeds the amount of the substitute check, you may be able to recover additional amounts under other law.
If you use this procedure, you may receive up to $2,500 of your refund (plus interest if your account earns interest) within not more than 10 business days after we received your claim and the remainder of your refund (plus interest if your account earns interest) not later than 40 calendar days after we received your claim.
We may reverse the refund (including any interest on the refund) if we later are able to demonstrate that the substitute check was correctly posted to your account.
How do I make a claim for a refund?
If you believe that you have suffered a loss relating to a substitute check that you received and that was posted to your account, please contact us at Resource Bank's Operations Department, 5100 Village Walk, Suite 102, Covington, LA. 70433 (or phone 985/801-0100). You must contact us within 45 calendar days of the date that we mailed (or otherwise delivered by means to which you agreed) the substitute check in question or the account statement showing that the substitute check was posted to your account, whichever is the later. We will extend this time period if you were not able to make a timely claim because of extraordinary circumstances.
Your written claim must include –
Need more info on Check 21?
Visit The Federal Reserve Board