`Floaters' of checks are sunk (Diebold, checks + paper trails)

[phoebe]

http://www.ohio.com/mld/beaconjournal/9183241.htm?1c

IF YOU'RE ONE of those people who rely on ``float'' to keep your checks from bouncing, you have about 90 days to change your ways.

The lag time between when a check is written and when it will get back to your account will all but disappear come Oct. 28.

That's when the Check Clearing for the 21st Century Act takes effect.

snip

Known throughout the banking industry as Check 21, the federal legislation on its face does little but allow for creation of a substitute check -- a digital facsimile of the original that all banking institutions must accept as a legal replacement.

Please read entire article. The DU "4 paragraph limit" makes this news story hard to synopsize..

What the h@%# does Diebold have against paper trails??

[Akbar]

1. What Will Be Interesting to See...

Say I write you a check. You take it to the bank and deposit it. The funds are immediately taken out of my checking account. I wonder how long it will be before they are available in your account?

[Mr.Green93]

7. five days, of course!

[depakid]

29. What's more

Credit card companies and utilities will still claim that the "check didn't clear" for 5-10 days, and will still charge you a late fee- even though they actually had the money in their accounts.

It's already a fairly common practice that's been the subject of class actions- and given the amount of money and lack of and real corporate accountability, don't think for one second that they'll let loose of that cash cow.

[osaMABUSh]

2. Who still uses checks? I pay all my bills online & debit/credit

at stores. Don't you hate when someone writes a check at the grocery checkout?


I got no problem with the float being gone on checks. Checks are way too inefficient.

[1monster]

4. Debit cards? With little or no paper trail? Kind of like touch screen

voting.

Twice in the last three months, the local big chain grocery store has put all debit card transactions through the bank two times. That is, twice that it has been caught. I wonder how many people are paying twice for their debit card purchases when there is a "malfunction" in the equipment.

See my post below. If you have a paper trail, it is easier to keep track of your transactions. The cancelled checks can be used for tax purposes and are proof of payment.

[Elginoid]

11. I have a paper trail with my debit card- almost too much.

I have the original reciept, as well as a monthly statement from my bank. In addition- I can check all of my transactions online, and print out if need be. In today's world, checks are becoming more and more superfluous to the process.

[fdr_hst_fan]

13. I worked in a bank for 30 years-

it wasn't the grocery store's fault; someone in the BANK'S data center (stupidly or accidentally) RE-RAN the tape with the grocery store's transactions on it. Once the store's bookkeeping dept sends the tape to their bank, God only knows if it will be handled properly!

[1monster]

26. In this case, it was the grocery store's fault. They said so...

[shanti]

23. i don't know about you

but i check my balance online at least 3-4 times a week. balancing a checkbook? what is that, lol!?

[yardwork]

9. Poor people float checks. The working poor, who live from paycheck

to paycheck.

This is another turn of the screw for the people getting screwed.

It won't affect the wealthy and the upper-income middle class at all. It will affect the working poor, the lower-income middle-class, young people starting out, and retired people who scrape by month to month.

[shanti]

22. LOL!

i'm glad someone else brought this up. this is one of my pet peeves, people who still write checks in stores! and they do it so slowly too :eyes:

[uncle ray]

39. it ranks right up there with counting out money

me, i take my cues from rush limpballs, i just pay with a hunnie and let the poor slob waiting on me keep the change.

[shanti]

40. yes!

the penny counters! eeeeeee!

[1monster]

3. Be careful and check your bank statements religiously EVERY month.

I had a $100.00 check and a $150.00 check put through my checking account twice. One check came through the second time three months after it cleared the first time. I had not received the cancelled check back with the statement when it cleared, and it was put through my account a second time.

I had received the second cancelled check back in the mail with my statement when it cleared, but six months later, I received a photo copy of the check with my statement when it was put through a second time.

In both cases, I had to wait for a refund of the money deducted from my account while the bank "investigated" my claim. I had the returned checks and the statements showing that the checks had cleared twice, but on the second occasion, I was kept waiting three weeks for the refund.

Another caution: Carefully check the account number on bank receipts for deposits. One teller was constantly giving me receipts with an account number other than mine.

Makes you wonder just how many bank employess there are that can't resist the temptation to skim a little bit here and there.

[Elginoid]

12. you should get a debit card -

:evilgrin:

[catmandu57]

5. We do this every now and then

at the grocery store when we won't be able to go later. It's a matter of convenience mostly if payday falls on a day that my wife will be home late we go the day before and float them a check knowing that by the time it comes in there'll be plenty of money to cover it. No more of that I guess.

[havocmom]

6. Don't wait until Oct to stop floating checks

many banks have already gone to the system and you could be whacked with lots of O.D. charges. This is a great gimme to the banking industry and once again, the poorest will be the ones to really feel the hit.

[Elginoid]

14. bouncy-check fees are thru the roof too-

at our bank, it's up to $30 per bounce- we haven't done that in several years tho-
that's another great thing about using debit cards- you can't bounce one on a purchase.

HOWEVER-
I live in mortal fear of losing my debit card, as the $50 deductible amount doesn't apply like it would with a credit card- if someone finds/steals your card, they can drain your account, and you're SOL as far as the bank is concerned.

[fdr_hst_fan]

16. IF they

know you PIN; they have to know THAT before they can drain your account.

[hippywife]

20. Nope...

we use our debit cards without PIN's all the time at stores. It's not required.

[Thor_MN]

28. No, in that case, you are using the card as a credit card.

If you don't enter a pin number the transaction is processed as a credit card. That's my understanding of it. I'm willing to change my mind if someone with a banking background says differently.

[osaMABUSh]

30. Debit card can be used as a Credit Card but ultimately the $

comes from your checking account. It just takes longer to process than the POS (point of sale) true debit transaction with a PIN.

I work at a large bank (25,000 employees) in Information Technology and a little scam my company does is encourage people to use their debit card without entering the PIN - you sign for it and 'pretend' it's a credit card. This way the transaction is treated as a credit and goes through the Visa clearinghouse system but ultimately hits your bank account. The scam is that Visa (or MasterCard) has to pay the issuer of the card (my bank) a fee for the transaction.

We even have internal company contests periodically called "Forget the PIN and Win" where if you use your debit card as a credit card you are automatically registered to win big prizes.

I never do it because I think it is a little dishonest just to make a few cents per transaction and certainly less efficient for the economy overall.

[Elginoid]

21. Not at the gas station, for one-

here in the big city, one little hoodlum with lots of friends/gang-friends can fill up a lot of tanks in very little time- i.e. before you even realize you lost it.

also- the debit card can just as easily be used as a credit card- and how many merchants/restaurants ever really check or ask for i.d.?

however the money goes- if it's as a result of a lost or stolen debit card, youse is screwed.

[nolabels]

19. I lost my wallet a few months ago

The easy part was the Debit card. After I absent mindedly left it on the top self in the closet, our cat must of somehow knocked into the bottom of the garment dust protector. After I made all the phone calls and reports, spent days going through everything and all the rest looking for it I come to find it there in the bottom of thing. It was good exercise that helped me to learn to keep track of things a little better (you never know what will happen next)




Protect Yourself Against Document Loss

Potential Problems with 30 different types of information


Most of us keep almost everything essential in our wallet (or purse) meaning that if we lose this single item, we lose almost everything of value, all at the same time!

Part 1 of a 3 part series - click for Parts One Two Three

You're traveling somewhere and lose your wallet. All of a sudden, you find yourself without tickets, without credit cards, without ID, and perhaps without any money, and minus your passport, too.

If that happened to you, - and it happens to tens of thousands of people, every day - what would you do? Are you prepared for such a disaster?
(snip)
http://www.thetravelinsider.info/2003/0509.htm

[Lydia Leftcoast]

32. I had my purse pickpocketed in 1998

I foolishly had everything--money, checkbook, driver's license, and cards--in one wallet. I had only six dollars cash, but I ran home and immediately called my bank's 800 number to report the theft.

In the half hour or so it had taken me to get home, the thief (thieves?) had 1) gone to another branch of my bank to write a check for cash, and 2) gone to Office Depot to buy a computer with my debit card.

Fortunately, when I went in to report the theft the next morning, the branch manager not only got right to work on my case but also let me have $100 to cover the next few days. The verdict was that since I had reported the theft immediately, I was not liable for either transaction, and the bank ate the loss.

However, I spent three days making police reports, going to banks, calling credit card offices, getting a new driver's license, health insurance card, and social security card, and all that bureaucratic stuff. It was lucky that I had canceled several credit cards just before the theft, so only my JC Penney card was still in the wallet.

I learned 2 lessons from this: 1) keep your purse closed when you're not actually accessing something, and 2) keep your money, checkbook, and cards in separate places.

I now have a wallet, a card holder that goes into a separate compartment in my purse, and a loose checkbook. That way, it's unlikely that a pickpocket will get everything at once.

[nolabels]

35. That is an ugly feeling to have things stolen

Had quite a bet of them kind of things happen to me also. The people doing it are sometimes as just as big of victims but in other unseen ways. "Needed it worse than you" is the line you hear, but that Idea or line of thinking don't sound so good when you got to go to work the next morning and they stole your car, tools or computer which would be needed to make a living with.

Come to think of it, the bushco attitude reminds me a lot of thieves

http://www.solidarity.com/hkcartoons/bush.html
http://www.solidarity.com/hkcartoons/mikeanim.html
http://www.bushnetwork.com/index2.php

[northzax]

24. actually, you can overdraw your debit card

especially on a weekend, since many places don't send in the information, beyond a simple hold, until the next business day. I have done it. not pleasant.

Get a debit card that has the VISA or MC logo on it, the $50 limit applies for all Visa or MC transactions, and unless they know your PIN, they have to use it as a VISA or MC. Unlike a Credit Card, however, you are stuck without the money until they replace it in several months.

[fdr_hst_fan]

15. And if banks paid a decent wage,

they could keep good workers; then there wouldn't BE problems like this one. Banks also OUTSOURCE a lot of their checking statement business, which COSTS jobs in banks-saw it happen, and it isn't worth a bucket of warm piss! I think bank employees should be UNIONIZED!
:mad:

[Toucano]

34. I have one small objection

in that I will contend that the poorest won't be the ones to feel the hit because the poorest don't have checking accounts.

http://www.bankrate.com/aolcan/news/special/19990730.asp
"Critics complain that financial institutions use ChexSystems indiscriminately, weeding out not only checking-account applicants who intend to commit fraud, but also law-abiding people who wrote a bad check or two by mistake, or who were irresponsible with their checking accounts but have since learned their lesson. They want Congress to specify which offenses merit reporting to the agency.

A negative ChexSystems report stays in the database for five years and can doom your chances of getting a checking account for that period. ChexSystems has records of 19 million accounts closed for cause. That's one record of a closed account for every 14 U.S. residents."

This is why you see long lines of people at the Currency Exchange, Western Union, supermarket, or liquor store on pay day. These are places that will cash a paycheck for people for a fee. Sometimes it's a percentage of the check, sometimes it's a flat fee.

The owner of a neighborhood liquor store near me boasted recently that the fees he collects from cashing payroll, disability, unemployment, social security and child support checks averages $10,000 per month. He only cashes checks that he can reasonably assume are good, so he has very little risk.

The middle class and those struggling to be middle class float checks. The poorest people were sunk long ago.

[belle]

8. I guess you could always post-date it, no?

[Maeve]

10. A lot of banks won't honor the post-date

It hits their office, doesn't matter what date is on it.

I used to use float fairly often, when the check was due on the 1st and payday wasn't until the 3rd. When you live paycheck to paycheck, you learn to step lively. Even a step or two up the ladder you can still have "cash flow" issues...

[1monster]

27. In Florida, a post date is not any protection. If you write the check,

you had better have the funds to cover it when you write the check. If it is presented to the bank, they will cash it regardless of the post date -- and you are legally responsible. I asked a State's Attorney about post dating when I was urged to write one by someone who wanted me to buy something now (I was reluctant). The SA told me that if I wrote the check and it was presented and there were not sufficient funds to cover it, I could be charged with uttering a fraudulent check... a felony. And it wouldn't matter if it were post dated or not.

[Toucano]

37. You are right.

Writing post-dated checks is asking for trouble. The date is meaningless.

[sendero]

17. Great.....

... so I assume we can stop those ridiculous holds on checks deposited?

[Jackpine Radical]

18. I have checking & savings accounts at a local credit union.

If I were to write a NSF check, they'd cover it out of my savings & immediately send me a notice they had done so. I have NEVER had a problem with them.

[northzax]

25. but for the people living paycheck to paycheck

savings may not be an issue, you know?

[Jackpine Radical]

36. Well--yeah.

Been there myself, and sometimes without the paycheck.

[slaveplanet]

31. cheers all around

one more pavement stone is laid on the road to the cashless society!

[TahitiNut]

33. Bank where your Accounts Payable department banks.

Many/Most Fortune 500 companies keep payable accounts at remote banks that take a while to clear. They manage the balances at these banks with wire transfers. These banks have few correspondent banking relationships, so checks deposited at other banks must go to the Fed to clear. (Companies make a game of picking banks that take the longest to clear.) The Fed has a legislated 'float' on deposited checks - they don't credit the depositor (a bank) for 3 days. (At least that's the way it used to be.) It's part of managing one of the measures of the money supply - the Fed varies the 'float.'

It's quite a racket. After all, what's the difference between owning a billion dollars and having a constant supply incoming and outgoing that lets you keep a billion dollars of other peoples's money? :shrug:

[Toucano]

38. This should be a boom for the "payday loans" businesses.

People who really need to float because of their pay schedule will turn to the high interest loan sharks in the mini-malls.