Cheque guarantee card

ERICS_MUM

My understanding of the cheque guarantee card is that the drawer can't place a "stop" on the cheque, or at least if a stop is placed, the paying bank will disregard it and pay the cheque (assuming all other technical details are correct).

Linda

cifpower

I believe that if the facility is being abused the cheque can be declined. Maybe the payer has been passing several bad cheques?

System

This is not correct (having worked in banking) they cannot refuse payment of a guaranteed cheque for lack of funds etc. If the correct procedures are followed, the bank are required to pay it. That's why they don't give the facility out to people with poor credit.

That doesn't mean that they won't try to fob you off though

cifpower wrote: »

I believe that if the facility is being abused the cheque can be declined. Maybe the payer has been passing several bad cheques?

omen666

Heng_Leng wrote: »

This is not correct (having worked in banking) they cannot refuse payment of a guaranteed cheque for lack of funds etc. If the correct procedures are followed, the bank are required to pay it. That's why they don't give the facility out to people with poor credit.

That doesn't mean that they won't try to fob you off though

Very true but sometimes peoples circumstances change and they go around cashing all their cheques when they get in some financial trouble. Natwest are known for refusing them even if guaranteed

jonesMUFCforever

They can only refuse them if the cheques are all paid to the same payee ie more than one cheque to cover a single transaction such as making out 3 £100 cheques to cover one bill of £300. They would have to pay the first cheque but could choose not to pay the second or third unless the payee can show that they were for different transactions.
If a cheque book has been stolen it is normally the bank that has to take the hit when cheques are debited to an account.

stclair

omen666 wrote: »

Yes they can and they do so and have been for some time

I agree a good while ago possibly 2 years ago now if not longer.

I wrote a cheque to tescos using my CGC the bank bounced my cheque. Then tescos wrote to me via Natwest saying i owed them XYZ amount of money.

izools

I will restate - a paying bank can refuse the payment of the cheque if the facility is being abused - drawing on non existent funds - because the paying bank will have reasonable suspicion of fraud.

Even if the account holder uses his own cheque card and all of the requirements are met, if he is knowingly attempting to draw on funds that he knows aren't, and won't be, present, he is committing fraud by misrepresenting himself.

I've experience this myself with HSBC. They closed my account because I knowingly drew on funds that weren't present with my cheque guarantee facility. The cheques were bounced, too (well the first one or two weren't).

jonesMUFCforever

So who decides what is fraud ? The whole point of the guarantee is that the payee gets guaranteed funds if they write the card number on the back of the cheque and that the cheque issigned in front of the payee and the signature checked.

We will have to agree to disagree - in any case they will all be defunct by 2011.

omen666

jonesMUFCforever wrote: »

So who decides what is fraud ? The whole point of the guarantee is that the payee gets guaranteed funds if they write the card number on the back of the cheque and that the cheque issigned in front of the payee and the signature checked.

We will have to agree to disagree - in any case they will all be defunct by 2011.

I don't think there is anything to agree/disagree about. The whole scheme is to guarantee the cheque in any circs as long as the details and procedures are kept. The issue is the banks are not following it/them

Nukumai

omen666 wrote: »

I don't think there is anything to agree/disagree about. The whole scheme is to guarantee the cheque in any circs as long as the details and procedures are kept. The issue is the banks are not following it/them

Correct.

"It is not possible to place a stop on a guaranteed cheque and once the bank receives the cheque, they will have to pay it"

http://www.ukpayments.org.uk/payment_options/plastic_cards/uk_domestic_cheque_guarantee_card_scheme/-/page/187/