What should happen if you put a post-dated check into an bank’s ATM before the check’s date?
In my naive view of the world, the bank should put a hold on all funds deposited in the ATM. When they are verified by a human, cash should immediately be credited, and check funds should be released when the check clears (or if you have a good relationship with your bank released immediately and the funds pulled back if there’s a problem with the check). If the date hasn’t occurred yet, the check should be held until that date, then processed.
Tellers do this if you try to deposit a post-dated check. They’ll accept it (at least at my bank), but warn you that it won’t be processed until the date on the check.
I did this with a check that was dated June 1st. I deposited it on May 28th (while I was thinking of it) to one of TD Canada Trust’s ATMs, and expected the funds to be released on the 1st. Instead, they processed the check, and tried to pull the funds out of a Bank of Montreal account. The person who wrote me the check hadn’t transferred funds in to cover it yet (why should he, its a post dated check?) and the check bounced out of his account (and charged him $5). We both called our banks, and the only thing they could offer was that I shouldn’t deposit post-dated checks in the ATMs.
His bank wouldn’t even refund the $5, which from my perspective is totally outrageous (and I’m a Bank of Montreal shareholder!!!). They said they’d look at the check, and if it was cashed before the date on it they’d refund his $5, but they charge $5 to look at the check, so he wouldn’t get any money back (how offensive is that?).
AND, he’s going to have to write me a new check (which I told him to take $5 off of since he definitely shouldn’t be paying for it – he didn’t do anything wrong). Apparently TD Canada Trust won’t charge me anything when the check is returned (which is good), but they’ll pull the funds back out of my account (which would have caused me problems, but since I’m forewarned I canceled a transfer so it should be all good on my end).
All they’d have to do to fix this flaw in their process is have the person who opens the deposit envelope check the check and make sure the date isn’t in the future. If it is, then put it in a file for processing on the proper day (and if its far in the future, maybe put a hold of the depositor’s account). Simple, but not something they’re willing to do.
Morals of the story: Take post-dated checks to be deposited to the tellers, don’t put them in machines and its far better to be a bank owner then a bank customer.