Bounced cheque (with funds in another account???)

Joe90 said:
Mr MacMahon or Manager (even by the staff),
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Remember that when I first joined the Bank!!! manager was God and never had to do any real work. Always aspired to have that job. Unfortunately the times changed and bank managers are now thrown out of paradise and are mere cannon fodder for disgruntled clients to feed on:(
 
Bronte said:
In the two cases you mentioned the bank were at fault and not just for bounding cheques. Can you show me a case where they bounced a cheque where the bank is not in any way at fault and there is no money in the account to meet it.
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In this case, there was funds to meet the cheque, just in a different account. The bank does have a legal right of set-off and could have paid the cheque.

I'm not saying that there is a case where there is an absolute lack of funds but in this case the bank should have looked at the holistic position of the customer, not the position of one single account
 
Joe90 said:
Years ago when I worked in the bank there was a facility to allow funds in savings to cover cheques that would not be covered by available funds in the current account - I think we called it a set-off? But way back then banking was a profession, and not an industry, and the bank manager was called Mr MacMahon or Manager (even by the staff), and he made the call on whether or not the cheque would be honoured if it was above a certain amount. . Different times, and different procedures now, there will be very few cheques written in the next few years, especially when it costs €1.30 to write one @ BOI....
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nearly 70 million cheques were written in 2013 and the decline is around 10% per annum. @50c stamp duty per item, it's a nice little earner for the Govt
 
The Op's colleague has 4 accounts, 2 savings and 2 current accounts, one of which has a €50k od facility. I'd be interested to know what the net overall position was across all accounts when the cheque was presented. I would be astounded if the net position was €18,000cr across all accounts and the cheque was then bounced when presented ! The question for me is how much in to her overdraft was she in the current account with the €50k facility when the cheque was presented on the second current account.
 
demoivre said:
The question for me is how much in to her overdraft was she in the current account with the €50k facility when the cheque was presented on the second current account.
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Not relevant to the decision as the accounts were not amalgamated for "offset" purposes. All accounts are treated as "stand-alone" unless the client has a specific agreement with the bank!
 
44brendan said:
Not relevant to the decision as the accounts were not amalgamated for "offset" purposes. All accounts are treated as "stand-alone" unless the client has a specific agreement with the bank!
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Is the day of the referral fee gone? Manys the time over the years ( before on line banking ) I would have written a cheque with insufficient funds in my current account but a healthy balance in a deposit account and never a problem, don't recall any offset arrangement ! Find it extraordinary that someone with €1,000,0000 on deposit would have a cheque for €1000 bounced if their was nothing in the current account, if no offset arrangement in place !
 
44brendan said:
Not relevant to the decision as the accounts were not amalgamated for "offset" purposes. All accounts are treated as "stand-alone" unless the client has a specific agreement with the bank!
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My understanding was always that the right of set off applies to current accounts only. Courts have certainly previously ruled that where one account was overdrawn and one in credit, the bank has no obligation to honour cheques on the account in credit if that credit balance is less then the overdrawn balance on the other account. There are limitations to this right but by and large the bank has to enter into a specific agreement not to set off, not the other way around.

Obviously like most common law on cheques, the decisions were made many many years ago and may not survive a challenge in a modern court.
 
banks have an automatic "right of set off" in law. This means that if the client has an unauthorized overdrawn balance in 1 account and a credit balance in the other the bank can refuse to release the funds in the credit account. This is different to an "off-set" arrangement where a bank can allow 2 separate accounts to operate as 1 for the purposes of paying cheques etc!
Referral fees are still there but AFAIK not utilized much any more. In general banks are trying to discourage cheque usage for personal clients and yes there are cases where a cheque can be bounced if where a deposit account has a significant credit balance. Perhaps not in the manner as represented above as it is likely that such a client would be referred before any cheque return!!
 
demoivre said:
The Op's colleague has 4 accounts, 2 savings and 2 current accounts, one of which has a €50k od facility. I'd be interested to know what the net overall position was across all accounts when the cheque was presented. I would be astounded if the net position was €18,000cr across all accounts and the cheque was then bounced when presented ! The question for me is how much in to her overdraft was she in the current account with the €50k facility when the cheque was presented on the second current account.
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There was credit of about €24K in the entire batch with NIL of the o/d facility drawn down.
 
I would say your colleague should be more concerned about the level of detail about her personal banking she is discussing at the coffee break than the minor embarrassment of a bounced cheque.
 
Just to keep ye up to date. Account holders bank immediately refunded the 'bouncing fee' once it was made clear that a formal complaint was bing made and the fee charged to the payee was refunded as well as a gesture. All now in order. Thanks for all yere help.
 
I feel you run the risk of a cheque being returned unpaid if drawn on an account without adequate funds or a sanctioned limit irrespective of what funds you have in other accounts. I too worked in a bank in the good old days? where the Referrals List was brought to the Manager for his (no lady managers then) decision. This practice led to large surcharge interest being charged in addition to normal interest so the customer really paid for not lhaving his account in order
 
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