A/c payee only cheques cahsed by 3rd party

akkers

Recently I issued some cheques to a tradesman. The cheques had the usual A/C Payee only which meant that I assumed the guy would have to deposit the cheques in his bank account. I later learnt that he had cashed the cheques through a High St cashing shop and never put the cheques through his own bank account (in fact it turns out he did not have an account). I lost a lot of money to this guy. My bank is being totally uncooperative and says that they have done nothing wrong.

Can I do something about this?

willo65

The cheques would still have to banked by the shop that cashed them and if the cheques were presented and cleared through their account then i don't see what difference it makes. If the guy had paid them into his account after they had cleared you wouldn't have been able to do anything to get the money back anyway.

Comyface

I too would have thought he would have to put them in his own bank account?

That aside, though, the person you wrote the cheque to did get the money the same as if he had put it into an account and then drawn it out and spent it IYSWIM. You gave him a cheque made out to him and he's now got your money.

I guess the only thing you could do is chase the guy if he owes you money?

akkers

What I am arguing about is a matter of trust. When you think the cheque is going to be lodged in a named bank acount you know the person HAS a bank account and can be trusted somewhat.

Further the words on the cheque say 'A/C account payee only' - is that not an instruction to the bank. I would have thought that the bank has to follow your instructions and not get involved in further 3rd party wheeling dealing in respect of your money.

btw the cheques came to my bank marked 'special presentation'.

dunstonh

My bank is being totally uncooperative and says that they have done nothing wrong.

The bank is correct.

Can I do something about this?

No.

These cheque cashing firms actually get round the a/c payee rules by technically setting up an account for that person and instantly giving out the cash.