Rejected / Returned Bank Draft when cashing into Santander

chrisdorman

I recently received a bank draft from a family member in Canada, from Bank of Montreal. This was marked ‘SUNDRY CURRENCY DRAFT’ and sent in pounds sterling to ideally allow this to be processed easily in the UK.

I then went to cash with Santander, who took it in at the branch and entered the details as a ‘normal’ cheque. This amount originally did appear in my account but then the amount was rejected due to a ‘returned cheque’ a few days later.

Firstly, what is the best thing to do now that this has been rejected? 

How can we go about recovering this bankers draft?

Secondly, going forwards what is needed to cash these bankers drafts with Santander?

I’m not 100% sure about bankers drafts and how these work but as is not a normal cheque and therefore not as simple as contacting the issuer?

As they have already paid the money to Bank Of Montreal to get the draft, can I get a replacement to use again or would the payee be able to recover the money from Bank of Montreal? 

retiredbanker1

IMO You will only get a photocopy of the original cheque.

If it has a UK sort code and account number and is made out in £sterling I would complain to Santander. They must have not processed the cheque correctly.

I remember seeing loads of these cheques years ago and there was a way to process them that was slightly different to UK cheques.

chrisdorman

There was no Sort Code / Account Number but does reference Lloyds bank in the To section.

xylophone

https://www.bmo.com/newstart/pdfs/Sending_and_Receiving_Money_ENG.pdf

Bank drafts and money orders

Bank drafts and money orders are a convenient, secure way to send money or make a payment, as they can be easily cashed here in Canada and overseas. They are safer than cash and widely accepted. Money orders can be purchased in Canadian dollars, U.S. dollars, and British pounds sterling. Bank drafts can also be purchased in those currencies, and can be used to make a payment in any country in which we have a banking relationship.

To learn more about sending a bank draft or money order, visit your local branch and speak with a BMO customer service representative.

I can't imagine that BMO don't have a banking relationship with the UK.

wmb194

It was probably processed incorrectly. For the future I’d look into using e.g., Wise’s CAD account to transfer the money electronically. It provides local Canadian account details that should be easy for people there to send money to.

retiredbanker1

chrisdorman said:

There was no Sort Code / Account Number but does reference Lloyds bank in the To section.

There is a way that this should have been processed - to me it looks like the Santander cashier did not know what the process was - i.e, just lumped it together with all the other day's cheques, so my advice is as before complain to your bank for a processing error.

(Was this for £50 by any chance? I was used to see loads of these sent by Canadians as gifts etc and they always seemed from memory to be for £50!)

retiredbanker1

xylophone said:

https://www.bmo.com/newstart/pdfs/Sending_and_Receiving_Money_ENG.pdf

I can't imagine that BMO don't have a banking relationship with the UK.

They do - the clue is in the OP's reply - Lloyds bank seems to be their agent bank in UK.

Ballard

I would expect you to receive the draft, with a reason why it was unpaid, within a week or so. I’m not that familiar with the process for drafts but if it were a cheque it might be possible to represent it, depending on the reason. 

Hoenir

retiredbanker1 said:

xylophone said:

https://www.bmo.com/newstart/pdfs/Sending_and_Receiving_Money_ENG.pdf

I can't imagine that BMO don't have a banking relationship with the UK.

They do - the clue is in the OP's reply - Lloyds bank seems to be their agent bank in UK.

That's only for processing. The funds still need to come from Canada to be credited to the UK account as cleared funds. 

Ballard

Hoenir said:

retiredbanker1 said:

xylophone said:

https://www.bmo.com/newstart/pdfs/Sending_and_Receiving_Money_ENG.pdf

I can't imagine that BMO don't have a banking relationship with the UK.

They do - the clue is in the OP's reply - Lloyds bank seems to be their agent bank in UK.

That's only for processing. The funds still need to come from Canada to be credited to the UK account as cleared funds. 

Without knowing the full details it’s impossible to be sure, but the likelihood is that BMO have a GBP account with Lloyds which they will have funded prior to issuing the draft. Upon presentation, Lloyds will simply debit that account. 

retiredbanker1

A draft is processed in exactly the same way as a cheque.
I know the legal differences  between the two, but I do believe the problem here is with Santander processing method.