Will in-store conversion threaten checking account?
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Remote deposit capture, authorized under Check 21, has been around since 2004; while back-office conversion, which converts a check to an ACH transaction, began in March 2007. Back-office conversion is a little different in that the payment has to be made in person to the business; for instance, you pick up your dry cleaning and pay the bill with a check.

What must businesses do?
A business that participates in back-office conversion must post a sign near the cash register stating that paying by check authorizes the store to make a one-time electronic transfer of money from your account; the money may be withdrawn that day, and you won't get your check back.

The retailer also has to ensure that you're who you say you are, and they can do that by checking a driver's license, a passport, military identification, etc.

Robert Johnston, product executive for Bank of America global treasury services, says banks must prudently assess their customers (businesses) before allowing them to have access to these remote deposit services.

"Every client that uses our products or services has to be a bank client. There are all sorts of account-opening procedures and 'know your customer' (guidelines) that banks have to adhere to. We've got to check them for Patriot Act requirements. There is a whole host of things done by our relationship managers, much like on the consumer side. You or I open a bank account and there are identification forms to be verified. It's not like we're going to give an application to somebody walking off the street and they're going to start depositing remotely."

Michelle Meredith, spokeswoman for PNC Bank, says business owners who wish to use their remote deposit system must meet certain requirements and contractually agree to a set of security controls. They are required to have a locked facility to store the checks until they are destroyed by shredder. The amount of time a check is held before being destroyed depends on the size of the business and check volume. Meredith says the bank also has a "rigorous" inspection process that includes physical inspections of the small business both before and after implementation.

What should consumers do?
A drawback for consumers, though, is there is no single set of rules banks must impose on their customers who want remote deposit. Banks take their responsibilities seriously, and there are also federal regulations and industry standards set by associations such as NACHA -- The Electronics Payments Association.

Check-writers must assume some responsibility if they want to protect their accounts.

"There's a whole host of reasons why everyone should look at their account statements regularly and this would be another reason," says Michael Herd, spokesman for NACHA. "Even if you just started depositing checks and writing checks or getting your pay by direct deposit or paying your bills online, you should check your account statements at least monthly. If you notice something you don't recognize or that you know you didn't authorize, contact your bank and get it re-credited."

Make sure a payment isn't deducted twice. While this could happen deliberately, it could also happen accidentally as long as the physical check still exists. Banking software may catch it, but consumers must be diligent.