Cashing crossed cheque - how does it work?

ey_up

Not sure if this is the correct forum to post in but am hoping someone can help.

I am interested in knowing how these cheque cashing companies actually go about cashing a cheque that is crossed and should therefore not be cashed. What is the process involved?

Can anyone give me an insight in how they get around the problem? Is it a play on loan rules or I have seen it mentioned on one internet posting that you effectively give them power of attorney over the cheque allowing them to bank it in their account with agreement from the bank.

How does the process work from the shops point of view?

Thanks

maggeeee

I have had the same problem. Unfortunately, from my experience, banks cannot do anything about it even if you did take down their cheque guarantee card number, which i find stupid. There is no point in a check guarantee card if it doesn't guarantee cheques. I have been to the branch where the cheque was issued, and due to data protection, they only allowed me to write a letter to the person who gave me the cheque. Basically its all a joke. However, I have heard of people who have been successful, so good luck with that.

dalesrider

maggeeee wrote: »

banks cannot do anything about it even if you did take down their cheque guarantee card number, which i find stupid. There is no point in a check guarantee card if it doesn't guarantee cheques.

Cheque guarantee cards ended about 18 months ago..

So you can write what you like on the back of the cheque and it makes no diffrence.

As to a crossed cheque. I would guess, that these co's have a agreement with their bank to take these, so long as they have followed certain procedures.
Which in my experiance many didn't.

opinions4u

I am interested in knowing how these cheque cashing companies actually go about cashing a cheque that is crossed and should therefore not be cashed.

They effectively open an account in your name.

They then charged fee which covers them against the risk of the cheque bouncing and give you the remaining cash.

jonesMUFCforever

The cheque cashing company has to supply their bankers with an indemnity guaranteeing they won't lose out financially or legally should a cheque be cashed fraudently.
That is how they are able to cash them.

ey_up

Thanks for the replies everyone