checking

Banks disagree over 'unpaid' check

Don TaylorQuestionDear Dr. Don,
I deposited a check into one of my banks in the amount of $12,450. The bank claims it was returned for insufficient funds. I contacted the issuing bank (Citibank), which is sending a copy of the paid check. How can I resolve this?
-- David Deposit

AnswerDear David,
Since I'm always on the customer side of the teller line, I asked Harriet Clark, a private banker at First National Bank, a division of Graystone Tower Bank, for her assistance in framing this reply.

Her recommendation is for you to contact your bank and ask for the adjustments department to do an investigation. They should look for "source of receipt on a paid item." Sometimes there's a mix-up and the money is being held until someone complains.

She further says, "As soon as the research determines that there was an error and the check is valid, the issuing bank will issue another check or ask the customer's bank to accept the original check as payment. The credit would be as soon as this is decided. As for fees, the issuing bank will sometimes refund fees if it is determined that they were at fault."

I expect that you have the matter sorted out by now, but you've no doubt done a service to other readers of this column who may find themselves in this position.

Join Bankrate's personal finance expert Dr. Don and tax guru Kay Bell for a Retirement Reality chat at 2 p.m. EST, Monday, Jan. 31. They'll be here live to tackle your toughest retirement questions. Mark your calendar and sign up for an event reminder today.

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