This document outlines key concepts regarding bank-depositor relationships and the check collection process. It discusses the duties of both banks and depositors, including a bank's duty to honor checks and protect funds. The document also describes the check collection process, defining terms like depositary bank, payor bank, and intermediary bank. It explains laws governing checks, like the Check 21 Act, which allows for electronic check processing and substitute checks. The Electronic Funds Transfer Act and consumer protections for electronic banking are also summarized.
This document discusses key concepts related to holders in due course, defenses, and liabilities for negotiable instruments. It defines what makes someone a holder in due course and provides the protections this status grants. Personal defenses that cannot be used against a holder in due course are outlined. Real or universal defenses that can be used against any holder are also defined. The document explains primary and secondary liability for different parties involved in negotiable instruments.
This document provides an overview of key concepts regarding holders in due course and defenses from Chapter 26 of the 6th edition of the textbook "Business Law". It defines the different statuses parties can have regarding negotiable instruments such as assignee and holder in due course. It outlines the requirements to qualify as a holder in due course including taking the instrument for value, in good faith, and without notice of any claims or defenses. It distinguishes between personal defenses that can be asserted against a holder in due course versus real defenses that can be asserted against any holder. It also discusses exceptions to holder in due course protections provided to consumers.
Chapter 32 – Negotiation and Holder in Due CourseUAF_BA330
This document provides a 3-page summary of key concepts related to negotiation and holders in due course of negotiable instruments. It begins by explaining the process of transferring negotiable instruments from one person to another, distinguishing between order paper and bearer paper. It then discusses the requirements for negotiation, types of endorsements, and effects of endorsement. The summary concludes by outlining the requirements to achieve holder in due course status and the rights and limitations of a holder in due course.
Chapter 32 – Negotiation and Holder in Due CourseUAF_BA330
The document discusses negotiable instruments, negotiation, holders in due course, and liability of parties. It covers topics like requirements for negotiation, types of endorsements, holders in due course status and rights, defenses, and issues around consumer protection.
This chapter discusses the liability of parties involved in negotiable instruments. It explains the differences between primary and secondary liability and outlines warranties made during the transfer and presentment of negotiable instruments. The chapter also discusses exceptions to normal liability rules, discharge of liability, and key court cases related to liability for negotiable instruments.
Chapter 34 – Checks and Electronic TransfersUAF_BA330
This document provides an overview of checks and electronic funds transfers. It discusses the relationship between depositors and banks, the bank's duties regarding payment and collection of checks, stop-payment orders, certified checks, cashier's checks, and issues related to forged, altered and stale checks. It also covers laws governing electronic funds transfers, check collection, funds availability, and wire transfers. Key points covered include a bank's liability for wrongful dishonor of checks and its right to charge properly payable checks, as well as obligations of both banks and customers regarding timely reporting of unauthorized transactions or errors.
Merchandising Transactions and Managing Payment RiskAzmir Latif Beg
The truth is that every payment method involves risk. Managing payment risks in merchandising transactions is very important. The major risks are fraud and operational risk.
Letters of credit is a written commitment to pay, by a buyer's or importer's bank (called the issuing bank) to the seller's or exporter's bank (called the accepting bank, negotiating bank, or paying bank). It is also known as a documentary credit.
This document discusses key concepts related to holders in due course, defenses, and liabilities for negotiable instruments. It defines what makes someone a holder in due course and provides the protections this status grants. Personal defenses that cannot be used against a holder in due course are outlined. Real or universal defenses that can be used against any holder are also defined. The document explains primary and secondary liability for different parties involved in negotiable instruments.
This document provides an overview of key concepts regarding holders in due course and defenses from Chapter 26 of the 6th edition of the textbook "Business Law". It defines the different statuses parties can have regarding negotiable instruments such as assignee and holder in due course. It outlines the requirements to qualify as a holder in due course including taking the instrument for value, in good faith, and without notice of any claims or defenses. It distinguishes between personal defenses that can be asserted against a holder in due course versus real defenses that can be asserted against any holder. It also discusses exceptions to holder in due course protections provided to consumers.
Chapter 32 – Negotiation and Holder in Due CourseUAF_BA330
This document provides a 3-page summary of key concepts related to negotiation and holders in due course of negotiable instruments. It begins by explaining the process of transferring negotiable instruments from one person to another, distinguishing between order paper and bearer paper. It then discusses the requirements for negotiation, types of endorsements, and effects of endorsement. The summary concludes by outlining the requirements to achieve holder in due course status and the rights and limitations of a holder in due course.
Chapter 32 – Negotiation and Holder in Due CourseUAF_BA330
The document discusses negotiable instruments, negotiation, holders in due course, and liability of parties. It covers topics like requirements for negotiation, types of endorsements, holders in due course status and rights, defenses, and issues around consumer protection.
This chapter discusses the liability of parties involved in negotiable instruments. It explains the differences between primary and secondary liability and outlines warranties made during the transfer and presentment of negotiable instruments. The chapter also discusses exceptions to normal liability rules, discharge of liability, and key court cases related to liability for negotiable instruments.
Chapter 34 – Checks and Electronic TransfersUAF_BA330
This document provides an overview of checks and electronic funds transfers. It discusses the relationship between depositors and banks, the bank's duties regarding payment and collection of checks, stop-payment orders, certified checks, cashier's checks, and issues related to forged, altered and stale checks. It also covers laws governing electronic funds transfers, check collection, funds availability, and wire transfers. Key points covered include a bank's liability for wrongful dishonor of checks and its right to charge properly payable checks, as well as obligations of both banks and customers regarding timely reporting of unauthorized transactions or errors.
Merchandising Transactions and Managing Payment RiskAzmir Latif Beg
The truth is that every payment method involves risk. Managing payment risks in merchandising transactions is very important. The major risks are fraud and operational risk.
Letters of credit is a written commitment to pay, by a buyer's or importer's bank (called the issuing bank) to the seller's or exporter's bank (called the accepting bank, negotiating bank, or paying bank). It is also known as a documentary credit.
This document provides an overview of negotiable instruments under Indian law. It defines negotiable instruments as credit instruments that can be transferred like cash. The key types of negotiable instruments are promissory notes, bills of exchange, and cheques. It outlines the essential features, parties involved, and differences between these instruments. Additionally, it covers related topics like crossing of cheques, endorsements, and classifications of negotiable instruments under Indian law.
The document discusses different types of bankruptcy proceedings including Chapter 7 liquidations, Chapter 11 reorganizations, and Chapters 12 and 13 for family farms and consumer debt adjustments. It explains the process for filing bankruptcy, the automatic stay of creditor actions, how claims are handled, trustee duties in distributing assets and developing reorganization plans, and issues around discharge of debts and dismissal for abuse. Key cases discussed include In re Rogers regarding homestead exemptions and In re Made In Detroit regarding plan feasibility for confirmation.
Chapter 28 – Introduction to Credit and Secured TransactionsUAF_BA330
This document provides an overview of secured and unsecured credit transactions. It defines secured credit as transactions where the creditor requires the debtor to convey a lien or security interest on their property to minimize the creditor's risk of loss. It differentiates suretyship from guaranty as security devices. It also describes various types of liens that can be placed on real and personal property to secure credit obligations.
This document provides an overview of banking law and operations. It defines key terms like bank, banker, and banking. It describes the characteristics and functions of banks, including their primary functions of accepting deposits and granting credit, as well as subsidiary functions like buying/selling securities. The document defines customer and explores the general and special relationships between bankers and customers. It examines obligations like honoring checks, maintaining secrecy, and following customer directions. The document concludes by outlining some rights and duties of bankers, such as the right of lien and the right to charge interest.
The document discusses the roles and responsibilities of a collecting banker when handling cheque collections. It outlines that a collecting banker can act either as a holder for value or as an agent of the customer. As a holder for value, the collecting banker enjoys rights similar to a holder in due course. As an agent, the banker must take precautions to avoid liability for conversion. The document also discusses the statutory protection provided to collecting bankers under Section 131 of the Negotiable Instruments Act if they collect payment in good faith and without negligence. It provides examples of negligence and outlines various duties and precautions collecting bankers must follow.
This document provides an overview of various banking operations including the roles of collecting and paying bankers, types of lending facilities, and non-performing assets. It discusses the duties of collecting bankers to carefully collect checks and notify customers of dishonored checks. Paying bankers must take precautions when honoring checks and can refuse payment for specific reasons. Banks offer various lending facilities like loans, cash credits, overdrafts and letters of credit. Non-performing assets are loans where borrowers do not repay principal or interest for a certain period.
The document discusses negotiable instruments and commercial paper. It provides an overview of negotiable instruments, including different types like promissory notes, checks, and certificates of deposit. It also covers key concepts like negotiability, holders in due course, and the Uniform Commercial Code articles that govern commercial paper. Examples are provided of cases involving ambiguous terms in negotiable instruments.
Documentary Credit means any arrangement that is irrevocable and thereby constitutes a definite undertaking of the issuing bank to honour a complying presentation
http://accountsknowledgehub.blogspot.com/
Documentary collection letters of creditjadayoub01
The document discusses various methods for reducing credit risk in international sales transactions, including bank collections, trade finance, and letters of credit. It provides definitions and explanations of bank collections, trade finance, documentary drafts, letters of credit, and related concepts. The focus is on how these methods work to transfer credit risk from the seller to a bank by having the bank guarantee payment to the seller upon presentation of required documents.
Red clause letters of credit originated as a means of providing sellers financing for purchases or production of goods. They allowed sellers to receive advances from the issuing or confirming bank before shipment using the letter of credit as collateral. While once common, red clause credits are now rarely used, being largely replaced by other forms of financing. Recent cases discuss liability and remedies under these historical letters of credit, but they remain mostly a thing of the past, confined now to only occasional or niche uses.
The document discusses various payment methods for international trade such as letters of credit, documentary collections, and guarantees. It also covers how to negotiate sales contracts, the process of issuing and transferring letters of credit, and international standards like Incoterms and UCP that govern international trade transactions.
This document discusses the roles and responsibilities of paying bankers and collecting bankers. It defines a paying banker as the banker who holds the account of the drawer of a cheque and is obligated to make payment if funds are sufficient. The key duties of a paying banker are to honor valid customer cheques in a timely manner according to law. A collecting banker undertakes to collect payment on cheques and other instruments from the paying banker on behalf of customers, and has duties to exercise care during collection and notify customers of dishonored cheques. The document also outlines circumstances where bankers may rightfully dishonor cheques and their liabilities for wrongful dishonor.
Paying banker and collecting banker b.v.raghunandan-chapter 6SVS College
This document discusses the roles and responsibilities of paying bankers and collecting bankers. It outlines various precautions paying bankers must take, such as verifying the nature of the cheque, branches, references, signatures, and balances. It also describes circumstances where cheques may be dishonored, such as countermanding, notice of death or insolvency. The document provides statutory protections for paying bankers and outlines duties of collecting bankers, such as prompt presentation, crediting, and noticing of dishonors. It defines holder in due course and describes potential liability for collecting bankers in cases of conversion, defective titles, or violating crossing restrictions.
This document provides an overview of international trade, payments, and financing. It discusses various methods of international payments including open account trading, documentary collections, and letters of credit. It describes the collection process, advantages and disadvantages for exporters and importers, and different types of letters of credit. The document also covers pre-shipment and post-shipment financing options for exporters and importers, including documentary import loans.
Chapter 28 – Introduction to Credit and Secured TransactionsUAF_BA330
This document provides an introduction to secured transactions and security interests in personal and real property. It defines key concepts like suretyship, guaranty, liens, mortgages, and deeds of trust. It also summarizes cases that illustrate issues that can arise in secured transactions, such as priority disputes between secured creditors and between secured creditors and lienholders.
The document discusses the roles and responsibilities of collecting bankers and paying bankers when dealing with cheques. It outlines two options a customer has when receiving a cheque - depositing it directly or sending it to their banker for collection. It explains that a collecting banker can act as a holder for value or as an agent, and describes the conditions under which they are considered a holder for value. The duties of paying bankers to verify cheque details and ensure sufficient funds are also reviewed. Statutory protections for collecting and paying bankers are discussed if they act in good faith and without negligence.
A letter of credit is a document from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. The document protects both parties in an international trade transaction. It is issued by an issuing bank on behalf of the buyer and states that the bank will pay the seller upon presentation of documents meeting the letter's terms. There are several parties involved including the applicant, beneficiary, issuing bank, advising bank, paying bank, and confirming bank. The letter of credit process involves the applicant applying to the issuing bank, which then issues the letter to the advising and beneficiary banks to facilitate payment from the buyer to the seller.
LETTER OF CREDITS or LOCs are common in international trade. The concept of LOCs can be complicated. This ppt makes them easier to understand in the best possible simple language. LEARN, CREATE AND SHARE!!!
This document provides an overview of different types of documentary credits used in international trade. It defines a documentary credit as a conditional payment guarantee from an importer's bank to an exporter. There are several types of credits described, including standby credits, transferable credits, deferred payment credits, revolving credits, back-to-back credits, red clause credits, green clause credits, transit credits, and omnibus credits. Each type has distinct features regarding payment terms, collateral requirements, parties involved, and applicable regulations.
This document provides information on how to open a letter of credit. It defines a letter of credit and discusses the typical parties involved, including the applicant, issuing bank, beneficiary, advising bank, confirming bank, negotiating bank, and second beneficiary. It also outlines the most common types of letters of credit and describes the standard process for opening a letter of credit, including applying at a bank and presenting the required documents. Finally, it briefly discusses some of the risks in letter of credit transactions and international trade payment methods.
The relationship between a banker and customer is contractual in nature, governed by the Negotiable Instruments Act and Indian Contract Act. A customer is anyone who opens an account with a bank.
The essence of the relationship is the bank's obligation to honor the customer's cheques, as long as sufficient funds are available. The banker acts as a debtor to the customer creditor, and has duties of confidentiality, honoring cheques, and supplying account statements.
The banker can dishonor cheques in certain situations like insufficient funds, ambiguity, or notice of customer death. A paying banker makes payment on a cheque, while a collecting banker receives payment on behalf of a customer. Collecting bankers have protection from liability
This document discusses the relationship between bankers and customers. It defines what constitutes a bank and banker according to Indian law. A customer is anyone who has an account with the banker. The relationship is contractual in nature, with the banker as the debtor and customer as the creditor. Key features of the relationship include the banker acting as trustee, agent, bailee, mortgagee, and lessor for the customer in various contexts. The document outlines duties of bankers such as honoring checks, supplying account statements, and maintaining confidentiality. It also discusses rights of bankers like setting off accounts and appropriating payments. The roles and duties of paying bankers and collecting bankers are defined in the context of crossed checks. The document provides scenarios in
This document provides an overview of negotiable instruments under Indian law. It defines negotiable instruments as credit instruments that can be transferred like cash. The key types of negotiable instruments are promissory notes, bills of exchange, and cheques. It outlines the essential features, parties involved, and differences between these instruments. Additionally, it covers related topics like crossing of cheques, endorsements, and classifications of negotiable instruments under Indian law.
The document discusses different types of bankruptcy proceedings including Chapter 7 liquidations, Chapter 11 reorganizations, and Chapters 12 and 13 for family farms and consumer debt adjustments. It explains the process for filing bankruptcy, the automatic stay of creditor actions, how claims are handled, trustee duties in distributing assets and developing reorganization plans, and issues around discharge of debts and dismissal for abuse. Key cases discussed include In re Rogers regarding homestead exemptions and In re Made In Detroit regarding plan feasibility for confirmation.
Chapter 28 – Introduction to Credit and Secured TransactionsUAF_BA330
This document provides an overview of secured and unsecured credit transactions. It defines secured credit as transactions where the creditor requires the debtor to convey a lien or security interest on their property to minimize the creditor's risk of loss. It differentiates suretyship from guaranty as security devices. It also describes various types of liens that can be placed on real and personal property to secure credit obligations.
This document provides an overview of banking law and operations. It defines key terms like bank, banker, and banking. It describes the characteristics and functions of banks, including their primary functions of accepting deposits and granting credit, as well as subsidiary functions like buying/selling securities. The document defines customer and explores the general and special relationships between bankers and customers. It examines obligations like honoring checks, maintaining secrecy, and following customer directions. The document concludes by outlining some rights and duties of bankers, such as the right of lien and the right to charge interest.
The document discusses the roles and responsibilities of a collecting banker when handling cheque collections. It outlines that a collecting banker can act either as a holder for value or as an agent of the customer. As a holder for value, the collecting banker enjoys rights similar to a holder in due course. As an agent, the banker must take precautions to avoid liability for conversion. The document also discusses the statutory protection provided to collecting bankers under Section 131 of the Negotiable Instruments Act if they collect payment in good faith and without negligence. It provides examples of negligence and outlines various duties and precautions collecting bankers must follow.
This document provides an overview of various banking operations including the roles of collecting and paying bankers, types of lending facilities, and non-performing assets. It discusses the duties of collecting bankers to carefully collect checks and notify customers of dishonored checks. Paying bankers must take precautions when honoring checks and can refuse payment for specific reasons. Banks offer various lending facilities like loans, cash credits, overdrafts and letters of credit. Non-performing assets are loans where borrowers do not repay principal or interest for a certain period.
The document discusses negotiable instruments and commercial paper. It provides an overview of negotiable instruments, including different types like promissory notes, checks, and certificates of deposit. It also covers key concepts like negotiability, holders in due course, and the Uniform Commercial Code articles that govern commercial paper. Examples are provided of cases involving ambiguous terms in negotiable instruments.
Documentary Credit means any arrangement that is irrevocable and thereby constitutes a definite undertaking of the issuing bank to honour a complying presentation
http://accountsknowledgehub.blogspot.com/
Documentary collection letters of creditjadayoub01
The document discusses various methods for reducing credit risk in international sales transactions, including bank collections, trade finance, and letters of credit. It provides definitions and explanations of bank collections, trade finance, documentary drafts, letters of credit, and related concepts. The focus is on how these methods work to transfer credit risk from the seller to a bank by having the bank guarantee payment to the seller upon presentation of required documents.
Red clause letters of credit originated as a means of providing sellers financing for purchases or production of goods. They allowed sellers to receive advances from the issuing or confirming bank before shipment using the letter of credit as collateral. While once common, red clause credits are now rarely used, being largely replaced by other forms of financing. Recent cases discuss liability and remedies under these historical letters of credit, but they remain mostly a thing of the past, confined now to only occasional or niche uses.
The document discusses various payment methods for international trade such as letters of credit, documentary collections, and guarantees. It also covers how to negotiate sales contracts, the process of issuing and transferring letters of credit, and international standards like Incoterms and UCP that govern international trade transactions.
This document discusses the roles and responsibilities of paying bankers and collecting bankers. It defines a paying banker as the banker who holds the account of the drawer of a cheque and is obligated to make payment if funds are sufficient. The key duties of a paying banker are to honor valid customer cheques in a timely manner according to law. A collecting banker undertakes to collect payment on cheques and other instruments from the paying banker on behalf of customers, and has duties to exercise care during collection and notify customers of dishonored cheques. The document also outlines circumstances where bankers may rightfully dishonor cheques and their liabilities for wrongful dishonor.
Paying banker and collecting banker b.v.raghunandan-chapter 6SVS College
This document discusses the roles and responsibilities of paying bankers and collecting bankers. It outlines various precautions paying bankers must take, such as verifying the nature of the cheque, branches, references, signatures, and balances. It also describes circumstances where cheques may be dishonored, such as countermanding, notice of death or insolvency. The document provides statutory protections for paying bankers and outlines duties of collecting bankers, such as prompt presentation, crediting, and noticing of dishonors. It defines holder in due course and describes potential liability for collecting bankers in cases of conversion, defective titles, or violating crossing restrictions.
This document provides an overview of international trade, payments, and financing. It discusses various methods of international payments including open account trading, documentary collections, and letters of credit. It describes the collection process, advantages and disadvantages for exporters and importers, and different types of letters of credit. The document also covers pre-shipment and post-shipment financing options for exporters and importers, including documentary import loans.
Chapter 28 – Introduction to Credit and Secured TransactionsUAF_BA330
This document provides an introduction to secured transactions and security interests in personal and real property. It defines key concepts like suretyship, guaranty, liens, mortgages, and deeds of trust. It also summarizes cases that illustrate issues that can arise in secured transactions, such as priority disputes between secured creditors and between secured creditors and lienholders.
The document discusses the roles and responsibilities of collecting bankers and paying bankers when dealing with cheques. It outlines two options a customer has when receiving a cheque - depositing it directly or sending it to their banker for collection. It explains that a collecting banker can act as a holder for value or as an agent, and describes the conditions under which they are considered a holder for value. The duties of paying bankers to verify cheque details and ensure sufficient funds are also reviewed. Statutory protections for collecting and paying bankers are discussed if they act in good faith and without negligence.
A letter of credit is a document from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. The document protects both parties in an international trade transaction. It is issued by an issuing bank on behalf of the buyer and states that the bank will pay the seller upon presentation of documents meeting the letter's terms. There are several parties involved including the applicant, beneficiary, issuing bank, advising bank, paying bank, and confirming bank. The letter of credit process involves the applicant applying to the issuing bank, which then issues the letter to the advising and beneficiary banks to facilitate payment from the buyer to the seller.
LETTER OF CREDITS or LOCs are common in international trade. The concept of LOCs can be complicated. This ppt makes them easier to understand in the best possible simple language. LEARN, CREATE AND SHARE!!!
This document provides an overview of different types of documentary credits used in international trade. It defines a documentary credit as a conditional payment guarantee from an importer's bank to an exporter. There are several types of credits described, including standby credits, transferable credits, deferred payment credits, revolving credits, back-to-back credits, red clause credits, green clause credits, transit credits, and omnibus credits. Each type has distinct features regarding payment terms, collateral requirements, parties involved, and applicable regulations.
This document provides information on how to open a letter of credit. It defines a letter of credit and discusses the typical parties involved, including the applicant, issuing bank, beneficiary, advising bank, confirming bank, negotiating bank, and second beneficiary. It also outlines the most common types of letters of credit and describes the standard process for opening a letter of credit, including applying at a bank and presenting the required documents. Finally, it briefly discusses some of the risks in letter of credit transactions and international trade payment methods.
The relationship between a banker and customer is contractual in nature, governed by the Negotiable Instruments Act and Indian Contract Act. A customer is anyone who opens an account with a bank.
The essence of the relationship is the bank's obligation to honor the customer's cheques, as long as sufficient funds are available. The banker acts as a debtor to the customer creditor, and has duties of confidentiality, honoring cheques, and supplying account statements.
The banker can dishonor cheques in certain situations like insufficient funds, ambiguity, or notice of customer death. A paying banker makes payment on a cheque, while a collecting banker receives payment on behalf of a customer. Collecting bankers have protection from liability
This document discusses the relationship between bankers and customers. It defines what constitutes a bank and banker according to Indian law. A customer is anyone who has an account with the banker. The relationship is contractual in nature, with the banker as the debtor and customer as the creditor. Key features of the relationship include the banker acting as trustee, agent, bailee, mortgagee, and lessor for the customer in various contexts. The document outlines duties of bankers such as honoring checks, supplying account statements, and maintaining confidentiality. It also discusses rights of bankers like setting off accounts and appropriating payments. The roles and duties of paying bankers and collecting bankers are defined in the context of crossed checks. The document provides scenarios in
The document discusses letters of credit and documentary credits. It provides definitions and explains the key concepts, parties involved, and mechanics of how letters of credit work. The main points are:
1) A letter of credit is a payment mechanism where a bank guarantees payment to the seller provided they present documents that meet the terms outlined in the letter of credit.
2) The key parties are the buyer, issuing bank, seller, advising/confirming banks. Goods are shipped after the letter of credit is opened, documents are presented, and payment is made.
3) Letters of credit can have different structures like transferable, back-to-back, revolving, and standby depending on the transaction specifics
Customer and Banker Relationship overview.pptak8820
The document discusses the relationship between bankers and customers. It defines bankers as dealers in capital who borrow from depositors and lend to borrowers. Customers are those who maintain bank accounts. The relationship involves general debtor-creditor ties where the bank owes customers the security of deposits. It also covers special agency relationships where the bank acts on customers' behalf. Overall, the document outlines the rights and duties of both bankers and customers in their relationship.
The document discusses key concepts related to banking. It defines a banker as someone who accepts deposits that can be withdrawn by cheque and uses those deposits to make loans and investments. It also defines a customer as anyone who maintains a bank account. The relationship between banker and customer is described as debtor-creditor, principal-agent, and other specialized relationships like bailee-bailor and mortgagor-mortgagee. The document also outlines key obligations of bankers like honoring checks, maintaining confidentiality, and handling accounts of deceased customers.
A banker is defined as a body corporate that accepts deposits from the public, lends money, invests deposited funds, and allows withdrawals. A customer is an individual or organization that conducts banking transactions. There are four types of customers: existing account holders, former account holders, non-account visitors, and prospective account holders. The core relationship between a banker and customer is that of debtor and creditor when a deposit is made, and creditor and debtor when a loan is given. Additional relationships include bailee and bailor regarding secured assets, and agent and principal regarding services performed on a customer's behalf.
The presentation includes:
- Definition of Cheque
- Parties in Cheque
- The requisites of Cheque
- Types of Cheques- Open and Cross Cheques
-Payment of Cheque
-Money Paid by Mistake
This document discusses the relationship between banks and their customers. It outlines that banks core business is accepting deposits from the public and utilizing those deposits to lend to borrowers or make investments. There are two types of deposits - demand deposits which are payable on demand like current accounts, and time deposits which are held for a specified period of time. The document then discusses the various roles and relationships that exist between banks and customers such as debtor-creditor, principal-agent, bailee-bailor, and more. It also outlines the rights and obligations of both banks and customers in the relationship.
Dell Technologies
NVIDIA Corporation
Twitter Inc.
Uber Technologies Inc.
Airbnb Inc.
Alibaba Group Holding Limited
Tencent Holdings Limited
Netflix Inc.
These companies have a history of strategic acquisitions to expand their business, enter new markets, or acquire talent and technology.
acqusition with other company list
ChatGPT
Certainly, here's a list of some notable acquisitions made by large companies:
Facebook (Meta Platforms, Inc.):
Instagram
WhatsApp
Oculus VR
CTRL-labs
Giphy
Beat Games (developer of VR game Beat Saber)
Alphabet Inc. (Google):
YouTube
DoubleClick
Nest Labs
Fitbit
Waze
Motorola Mobility
Amazon:
Whole Foods Market
Zappos
Ring
Twitch
PillPack
Audible
Microsoft Corporation:
LinkedIn
GitHub
Skype
Mojang (developer of Minecraft)
ZeniMax Media (parent company of Bethesda Softworks)
Apple Inc.:
Beats Electronics
Shazam
PrimeSense
NextVR
Dark Sky
Oracle Corporation:
Sun Microsystems
NetSuite
PeopleSoft
Siebel Systems
Hyperion Solutions Corporation
IBM (International Business Machines Corporation):
Red Hat
The Weather Company
Cognos
SoftLayer Technologies
SPSS
Salesforce:
Tableau Software
MuleSoft
Slack Technologies
ClickSoftware
Cisco Systems:
AppDynamics
Meraki
WebEx
Jasper Technologies
OpenDNS
Intel Corporation:
Mobileye
Altera Corporation
McAfee
Nervana Systems
Habana Labs
These acquisitions represent strategic moves by these companies to strengthen their product offerings, expand into new markets, or acquire valuable technology and talent.
If you're referring to acquisitions made by companies prior to the implementation of the Goods and Services Tax (GST), here are some acquisitions that occurred before GST was introduced:
Facebook (Meta Platforms, Inc.):
Instagram (Acquired in 2012)
WhatsApp (Acquired in 2014)
Oculus VR (Acquired in 2014)
Alphabet Inc. (Google):
YouTube (Acquired in 2006)
DoubleClick (Acquired in 2008)
Nest Labs (Acquired in 2014)
Amazon:
Zappos (Acquired in 2009)
Twitch (Acquired in 2014)
Microsoft Corporation:
LinkedIn (Acquired in 2016)
Skype (Acquired in 2011)
Apple Inc.:
Beats Electronics (Acquired in 2014)
Shazam (Acquisition announced in 2017, completed in 2018)
Oracle Corporation:
Sun Microsystems (Acquired in 2010)
Siebel Systems (Acquired in 2006)
IBM (International Business Machines Corporation):
Cognos (Acquired in 2007)
SPSS (Acquired in 2009)
Salesforce:
Tableau Software (Acquired in 2019)
MuleSoft (Acquired in 2018)
Cisco Systems:
WebEx (Acquired in 2007)
Meraki (Acquired in 2012)
Intel Corporation:
McAfee (Acquired in 2011)
Altera Corporation (Acquired in 2015)
These are just a few examples of acquisitions made by companies prior to the implementation of GST. These acquisitions have played significant roles in shaping the strategies and offerings of these tech giants.
If you're referring to acquisitions made by companies prior to the implementation of the Goods and Services Tax (GST), here are some acquisitions that occurred before GST was introduced:
Facebook (Meta Platforms, Inc.)
Chapter 24: Introduction to Negotiable Instruments Tara Kissel, M.Ed
This document provides an overview of negotiable instruments and the bank collection process in 6 chapters. It defines types of commercial paper like notes, drafts, checks and certificates of deposit. It describes the roles of banks in the collection process and the rights and responsibilities of banks and depositors, including issues like wrongful dishonor, stop-payment orders, and customers' duty to examine statements. Key topics covered include negotiability requirements, terminology, the collection timeline and process, and applicable laws governing electronic funds transfers.
elationship between banker and customer
,
definition of a banker and customer
,
definition of banking
,
general relationship between banker and customer
,
relationship as debtor and creditor
,
special relationship: banker as trustee
,
pawner and pawnee
,
bailer and bailment relationship
,
mortgager and mortgagee relationship
,
executer
,
attorney
,
guarantor
,
duties of a customer
,
rights and duties of the banker towards the custom
,
rights of a banker
,
garnishee order
The relationship between bankers and customers is important, as they both serve society and the economy. A banker is defined as accepting deposits from the public that are repayable on demand. A customer maintains an account with the bank.
The relationship involves general debtor-creditor aspects, with the bank as debtor owing the customer's deposit. Special relationships also exist, such as bailor-bailee. Customers have duties like timely check presentation and care of checkbooks. Banks have duties like honoring checks and maintaining account secrecy. Both parties have corresponding rights around accounts, compensation, and services.
The document discusses the relationship between bankers and customers. It defines a banker as a person who receives money from customers and repays it on demand. A customer is a person who has an account, either deposit or current, with the banker.
The relationship is contractual, with the banker as debtor and the customer as creditor. However, the roles can be reversed if the banker lends money to the customer. The relationship also involves aspects of an agency with obligations and rights on both sides.
The document outlines circumstances when a banker must or may dishonor a customer's cheque, as well as protections afforded to paying and collecting bankers.
This document provides definitions and guidelines for understanding and applying the Uniform Customs and Practice for Documentary Credits (UCP600). It begins with definitions of key terms like applicant, beneficiary, complying presentation, credit, issuing bank, and nominated bank. It then outlines guidelines for credit requirements, standard examination of documents, complying and discrepant presentations, transport documents, insurance documents, and other issues commonly addressed in documentary credit transactions. The overall purpose is to establish a common framework and shared understanding for parties involved in credits subject to UCP600 rules.
The document outlines the rights and responsibilities of both banks and their customers. It discusses several key areas including interest rates, service charges, loan documents, credit cards, ATMs, cheque collection and more. The main points are that banks must treat customers fairly, be transparent, and protect customer interests through regulations and complaint processes. Customers also have responsibilities to read terms carefully, borrow responsibly, and work with banks to resolve any issues. Overall, the document emphasizes balanced responsibilities between banks and customers to build trust in the banking system.
This document discusses international transaction laws and letters of credit. It defines a letter of credit as a commitment from a bank to guarantee payment for an import/export transaction. The document outlines the key parties in a letter of credit transaction and the process, from the buyer obtaining a letter of credit to the goods being shipped and payment being made. It also discusses different types of letters of credit and factoring, including recourse vs. non-recourse factoring.
This document discusses various methods of making and receiving payments, including cash, cheques, credit cards, money orders, postal orders, electronic transfers, standing orders, bank drafts, and letters of credit. Cash allows for quick payments but carries theft risks, while cheques provide proof of payment but may bounce. Credit cards offer lines of credit for purchases. Money orders and postal orders are obtained from post offices for sending smaller or larger fixed amounts. Electronic transfers and standing orders automatically transfer funds between bank accounts on a one-time or recurring basis. Bank drafts and letters of credit provide guarantees of payment from banks.
The document discusses key aspects of negotiable instruments under the Negotiable Instruments Act of 1881. It begins with definitions of negotiable instruments such as promissory notes, bills of exchange, and cheques. It then covers topics like parties to negotiable instruments, characteristics of negotiable instruments, crossing of cheques, liability of banks, and legal provisions regarding dishonored cheques. The document aims to explain the basic concepts around negotiable instruments and related laws in India for banking professionals.
Negotiable instruments are legal documents that can be transferred between parties as a form of payment. Common examples include cheques, promissory notes, and bills of exchange. Cheques allow parties to transfer money from a bank account, while promissory notes and bills of exchange facilitate credit transactions. Negotiable instruments must meet certain legal requirements to be enforceable, such as being in writing, containing an unconditional order of payment, and specifying the amount to be paid. Misusing these instruments by forgery, fraud, or bouncing payments can result in legal penalties like fines and imprisonment according to Nepali law. Proper use of negotiable instruments is important for commercial and financial transactions.
This document outlines key concepts regarding sales contracts, including rights and duties of buyers and sellers, breach of contract, and warranties. It defines tender of performance and outlines what is required for proper tender by buyers and sellers. It also discusses remedies available to buyers and sellers in cases of breach, including cover, damages, and price recovery. The document explains express and implied warranties, including how warranties can be excluded, and key provisions of the Magnuson-Moss Warranty Act regarding consumer protections.
Chap015 product liability and consumer protectionneogenesis6
This document discusses various laws and regulations pertaining to product liability, consumer protection, and consumer credit. It defines key concepts like negligence, strict liability, unfair/deceptive practices. It describes agencies like the FTC and laws they enforce including the Consumer Product Safety Act, Truth in Lending Act, and rules around issues like used cars, telemarketing, identity theft. The document also addresses consumer credit laws regarding billing, reporting, and debt collection.
BUS 116 Chap031 wills trusts and advance directivesneogenesis6
This document provides an overview of probate law, wills, trusts, and estate planning. It defines key terms like probate, will, bequest, devise, beneficiaries, and heirs. It describes the formal requirements for executing a valid will, including being in writing, signed by the testator, and witnessed. It also discusses revoking or changing a will, contesting a will, dying without a will, and the rights of surviving spouses and other heirs under intestacy laws. The document uses examples from North Carolina probate code to illustrate concepts like will execution requirements, elective share rights for spouses, and rules of intestate succession.
BUS 116 Chap029 personal property and bailmentsneogenesis6
This document provides an overview of personal property and bailments. It defines key terms like tangible and intangible personal property, different types of property ownership including tenancy in common and joint tenancy, and classifications of lost, misplaced and abandoned property. It also explains bailment law including the types of bailments and standards of care for bailees. Special bailments like those involving innkeepers, carriers, and warehouses are described along with their applicable duties and liabilities.
BUS 116 Chap030 real property and landlord tenantneogenesis6
This document provides an overview of key concepts related to real property and landlord/tenant law. It defines different types of real property interests such as estates in land, easements, fixtures, and water rights. It also explains how title to property can be acquired and protected through deeds, adverse possession, and eminent domain. Finally, it outlines the essential elements of the landlord-tenant relationship including different types of leases and tenant interests.
This document outlines key concepts and terms related to insurance. It defines risk management and explains the purpose of insurance is to transfer risk from the insured to the insurer. The main parties to an insurance contract are the insurer, who accepts the risk of loss in exchange for a premium, the insured, who is protected by the policy, and the policy itself, which is the contract. There are several types of insurance discussed, including life, property, health, automobile, and others. The document provides details on concepts like insurable interest, deductibles, and coinsurance. It also explains various types of policies and coverages in more depth.
This document discusses key concepts related to corporate entities. It defines a corporation as a legal entity created by state statute that allows individuals to operate a business. It describes different types of corporations including private, public, and quasi-public corporations. Key elements of incorporation like articles of incorporation, bylaws, and shares are explained. The document also distinguishes between de jure and de facto corporations and discusses piercing the corporate veil.
This document provides an overview of government regulation of corporate business in the United States. It covers the development of federal and state power to regulate business, securities laws like the Securities Act of 1933 and Securities Exchange Act of 1934, antitrust laws like the Sherman Antitrust Act, and the role of agencies such as the SEC and FTC. It also discusses corporate expansion tactics, their treatment under securities and antitrust laws, and circumstances for involuntary or voluntary corporate dissolution.
This document provides an overview of key concepts in corporate governance, including:
- The five main theories of corporate governance: special interest group control, governmental control, independent director control, managerial control, and shareholder democracy.
- The roles and responsibilities of directors, officers, and shareholders. Directors manage the corporation, officers operate it, and shareholders own it.
- Shareholder rights like examining records, receiving dividends, transferring shares, and preemptive rights to purchase new stock offerings.
- Laws and rules governing management responsibilities, like the business judgment rule, fairness rule, and Sarbanes-Oxley Act requiring directors to monitor legal compliance.
BUS 116 Chap025 sole props and partnershipsneogenesis6
This document discusses different types of business organizations including sole proprietorships and partnerships. It defines sole proprietorships and outlines their advantages and disadvantages. It describes the Revised Uniform Partnership Act and elements of a partnership. It explains the differences between entity and aggregate theories of partnership. It discusses partnership formation, property rights, management duties, dissociation vs dissolution, and types of partnerships like limited liability partnerships and limited partnerships.
This document provides an overview of US bankruptcy law, including:
1. Chapter 7 bankruptcy provides for liquidation of assets to pay creditors.
2. Chapter 11 bankruptcy allows businesses to restructure debts while remaining operational.
3. There are eligibility requirements to file for different chapters, including income-based means tests for Chapter 7.
This document provides an overview of mortgages and security interests. It defines key terms like secured vs unsecured loans and security interests. It describes different types of mortgages including conventional, adjustable rate, interest-only, balloon payment, and reverse mortgages. It explains the roles of Fannie Mae, Ginnie Mae, and Freddie Mac in the mortgage market and how securitization contributed to the financial crisis through risky loans like liar loans and NINJA loans. It also covers creating security interests in personal property and requirements for attachment.
This document provides an overview of negotiable instruments including their purpose and key types. It defines a negotiable instrument as a written and signed document containing an unconditional promise or order to pay a fixed sum of money. The main types discussed are promise instruments like notes and certificates of deposit, and order instruments like drafts/bills of exchange and various types of checks. The document also covers the requirements for an instrument to be negotiable, parties to instruments, transferring instruments through assignment and negotiation, and types of endorsements.
BUS 115 Chap008 offer acceptance mutual assentneogenesis6
This document provides an overview of key concepts related to offer, acceptance, and mutual assent in contract law. It defines mutual assent as both parties knowing the contract terms and agreeing to be bound by them. An offer is a proposal indicating a willingness to enter a contract and must demonstrate serious intent, clear terms, and be communicated to the offeree. Acceptance occurs when the offeree agrees to the offeror's terms. Defects like fraud, misrepresentation, mistake, duress or undue influence can undermine mutual assent.
BUS 115 Chap007 contract law essentialsneogenesis6
This document provides an overview of key concepts in contract law. It defines a contract as an agreement between two or more competent parties based on mutual promises to do or refrain from doing something that is neither illegal nor impossible. It discusses the origins of contract law in the law merchant developed by medieval merchants and its adoption into common law. The document outlines the four elements of a valid contract and objectives of contract law to compensate the injured party. It also distinguishes different types of contracts and contractual principles like privity and remedies for breach.
BUS 115 Chap012 third parties, discharge, remediesneogenesis6
This document provides an overview of key concepts relating to third parties and contract discharge and remedies. It discusses the legal rights of intended and incidental third party beneficiaries, as well as the assignment of contract rights and delegation of duties. It also covers various ways a contract can be discharged, such as through performance, agreement between the parties, impossibility of performance, and breach. Remedies for breach are also addressed, including damages, specific performance and injunctive relief.
This document provides an overview of key concepts regarding written contracts, including:
1. It outlines 10 learning objectives related to the Statute of Frauds, contracts that must be in writing, contents of required writings, and legal rules for written contracts.
2. It describes the Statute of Frauds as the law requiring certain contracts to be in writing, and lists the types of contracts that must be in writing, such as contracts that cannot be completed within one year.
3. It explains legal rules for written contracts, including the standard construction rule for interpreting contracts, the parol evidence rule regarding oral statements made before signing, and exceptions to the parol evidence rule.
This document discusses contractual capacity and the capacity of minors to enter into contracts. It defines key concepts like capacity, disaffirmation, and emancipation. It provides examples of types of contracts that minors can void, like executory contracts, and contracts they are liable for, like necessaries. The document also discusses other capacity issues like mental impairment, intoxication, and ratification. It examines cases related to minors' contracts and restrictions on agreements that are considered unlawful.
BUS 115 Chap009 consideration and cyberpaymentsneogenesis6
This document discusses consideration in contracts and cyberpayments. It defines consideration as a bargained-for exchange between parties where each party provides benefits and suffers detriments. Consideration must involve a legal detriment like doing something one is not required to do or refraining from something one can legally do. The document also discusses issues like adequacy of consideration, bargained exchanges, and exceptions to consideration like promissory estoppel. It analyzes cyberpayment options and security issues in light of EU privacy directives.
This document provides an overview of tort law. It defines a tort as a private wrong that injures another person, and a tortfeasor as the person committing the tort. It discusses the differences between tort and criminal law. It covers various intentional torts like battery, false imprisonment, defamation, and intentional infliction of emotional distress. It also discusses negligence, strict liability, defenses to negligence, and remedies for torts. Key topics include duty, breach of duty, proximate cause, actual harm, contributory and comparative negligence, assumption of risk, and injunctions.
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2. Learning Objectives
1. Clarify the bank’s duties in the bank–depositor
relationship.
2. Clarify the depositor’s duties in the bank–depositor
relationship.
3. Explain a drawer’s rights in relation to a stop-payment
order.
4. Explain the extent of the insurance protection provided
by the FDIC.
5. List the different terms used to describe banks during
the bank collection process.
3. Learning Objectives (cont.)
6. Outline a check’s life cycle.
7. Describe the principal features of the Check 21 Act.
8. Describe the consumer protection features of the
Check 21 Act.
9. Describe the process of an electronic fund transfer.
10. Discuss the protection given to consumers by the
Electronic Fund Transfer Act.
4. The Bank–Depositor Relationship
• The relationship between the drawee bank and
its customer is that of both:
– Debtor and creditor
• Customer deposits money at bank, customer is creditor,
bank is debtor
– Agent and principal
• Bank (agent) attempts to collect negotiable instruments
made payable to the customer (principal)
• Provisional settlement – may be revoked by bank if
instrument is dishonored (bank will try to get their money
back from you)
5. The Bank’s Duties
• The drawee bank is under a duty to:
– Honor orders
– Protect funds
• Certain limitations apply
6. The Bank’s Duties – Duty to Honor Orders
• Duty to honor all checks drawn by customers,
provided sufficient funds exist
– If insufficient funds, bank may create an overdraft,
reversing creditor/debtor relationship
– If bank dishonors check by its own mistake, bank
liable to customer for actual damages
– Drawee bank not liable to holder of check, unless it is
certified
– Holder’s recourse would be against drawer or
indorsers
7. The Bank’s Duties – Duty to Honor Orders
• Stale check
– Check presented for payment more than six
months after its date.
– Bank is under no obligation to a customer to
pay a stale check unless it is certified.
– Bank may honor a stale check without liability
to its customer if it acts in good faith
8. The Bank’s Duties – Death or Incompetence
• The drawee bank is not liable for the payment of
a check before it has notice of the death or
incompetence of the drawer.
• Bank may pay or certify checks for 10 days after
the drawer’s death
– Allows holders of checks drawn shortly before
drawer’s death to cash them without filing a claim
against drawer’s estate
9. The Bank’s Duties – Forged and Altered Checks
• Forgery
– Fraudulent making or alteration of a writing
• Uttering
– Knowingly offering a forged instrument to
another person
10. The Bank’s Duties – Forged and Altered Checks
• If bank (in good faith) pays the altered amount on
a check to a holder, bank may only deduct the
original amount from drawer’s account
• If bank pays on an instrument where signature
has been forged, bank liable to depositor
11. The Bank’s Duties - Availability of Funds
• Competitive Banking Act
– the Federal Reserve Board of Governors issued
Regulation CC, which requires banks to make
funds available to depositors according to a
prescribed schedule
12. Availability of Funds
• Business day
– defined under Regulation CC as Monday
through Friday, except for most federal
holidays.
• Banking day
– any business day (up to the bank’s cut-off
hour) when the bank is open for substantially
all of its banking activities.
14. Midnight Deadline
• If payor bank is not depositary bank
– must settle for an item by midnight of the banking
day of receipt
• If payor bank is also depositary bank
– must pay or return check by midnight of the next
banking day after it receives the item
15. The Depositor’s Duties
• Have sufficient funds on deposit to
cover checks that they write.
• Examine statements and canceled
checks promptly and with reasonable
care.
• Notify bank quickly of discrepancies
16. Bad Checks
• The payee has the obligation of informing
the drawer of the nonpayment of the check,
together with:
– notice of the provisions of the bad-check law
– the party’s legal rights and obligations
17. Bad Checks
• After receiving notice of nonpayment or
dishonor
– The drawer is given a specified number of days,
usually 5 or 10
– in which to make the check good without fear
of prosecution
18. North Carolina Worthless Check Law
Worthless check
≤ $2,000 = misdemeanor
> $2,000 = felony
Bank will send bad check back to merchant with NSF stamp
Checks not eligible:
Loans or Extensions of Credit
Two Party Checks
Pre- or Post-dated Checks
Lost or Stolen Checks
Stop Payments
Checks over two years old
Merchant must send certified letter to drawer
No response after 15 days – notify local District Attorney’s Office
(online application available)
District Attorney sends another certified letter
No response after 30 days – criminal warrant issued
Treble damages are possible (in addition to $25 bad check fee, min $100 max $500)
Gaston & Lincoln counties do not
currently participate in the state-allowed
Worthless Check Forgiveness Program
19. Duty to Examine Accounts
• Depositors have duty to examine their bank
statements and canceled checks promptly and
with reasonable care
• Notify bank of forged or altered instruments
– If a forged or altered check, within one year
– If a forged indorsement, within three years
– If the same wrongdoer had forged multiple checks,
within 30 days of receipt of statement
20. Antedated and Postdated Checks
• Antedated check
– written and dated on one day and delivered at a later
time
• Postdated check
– the drawer delivers it before its stated date
• A bank may charge a postdated check against a
customer’s account unless the customer has
notified the bank of the check within a
reasonable time for the bank to act on it.
21. Stop Payment Rights
• Drawers may stop payment on any item payable
on their account
– have to give bank reasonable time to act on it
• If the bank fails to stop payment, bank is liable for
losses, but burden of proof is on customer
• Oral order – valid for 14 days, unless renewed in
writing
• Written order – valid for 6 months, unless
renewed in writing
22. Stop Payment Rights
• Subrogation
– The bank may take the place of any holder,
holder in due course, payee, or drawer who
has rights against others on the underlying
obligation.
23. Insured Accounts
• The Federal Deposit Insurance Corporation (FDIC)
insures deposits in banks as well as in savings and
loan associations.
• The basic insurance coverage protects individual
bank accounts for up to $100,000* and joint
accounts for up to an additional $100,000*
• *This has been changed to $250,000
• Insured Accounts
24. Bank Descriptions
• Depositary bank
– the first bank to which an item is transferred for
collection
• Payor bank
– a bank by which an item is payable as drawn or
accepted
• Intermediary bank
– any bank to which an item is transferred in the course
of collection, except the depositary or payor bank
25. Bank Descriptions
• Collecting bank
– any bank handling the item for collection, except the
payor bank
• Presenting bank
– any bank presenting an item, except a payor bank
• Remitting bank
– any payor or intermediary bank remitting for an item
– Remit = send payment
26.
27. Cyber-Banking
• Using computers and electronic technology as a
substitute for checks and other banking methods.
– Check 21 Act
– Electronic Fund Transfer Act
28. Check 21 Act
• Brings the check-clearing method into the
modern age by the use of electronic check
processing.
• Changed requirement that original checks
be presented to the drawee bank for
payment
• Substitute check is used
29. Check 21 Act
• Substitute check
– paper reproduction of both sides of an original check
that can be processed just like the original check
– also called an image replacement document or IRD
• Original checks no longer returned
– Customer may request paper reproduction of original
check, this is often provided online
31. Consumer Protection
This right to expedited credit exists if the
consumer asserts in good faith the following
four facts:
32. Consumer Protection
1. The bank charged the consumer’s account for a
substitute check that was given to the
consumer.
2. Either the check was not properly charged to
the consumer’s account, or the consumer has a
warranty claim with respect to the substitute
check.
3. The consumer suffered a resulting loss.
4. The production of the original check or a better
copy of the original check is necessary to
determine the validity of any claim.
33. Consumer Protection
•
The bank must investigate if a consumer makes
a claim within 45 days of receiving the bank
statement or substitute check
•
If it needs more than 10 days to investigate,
must credit the account up to $2,500
•
The balance above $2,500 must be credited
within 45 days after the claim
34. Electronic Banking
• Online debit cards (run as debit, PIN-based)
– make an immediate transfer of money from the customer’s
bank account to the merchant’s bank account.
• Offline debit cards (run as credit, signature based)
– record a debit against the customer’s bank account, which is
processed later.
•
•
http://www.consumerismcommentary.com/visas-take-on-debit-cards/
http://www.wisebread.com/debit-or-credit-which-one-should-you-choose-atthe-checkout
35. The Electronic Funds Transfer Act
• A consumer protection act covering EFTs
– Does not apply to transactions between banks and
other businesses
• Entitles consumers to receive a written receipt
when they use an ATM
• Requires the transaction to appear on the
periodic statement
• Allows consumers 60 days to notify bank of
errors and requires bank to investigate
36. Question?
A stale check is one that is presented for payment
more than ________ after its date.
A. One year
B. Five years
C. Six months
D. Ten weeks
37. Question?
What is the offering of a forged instrument to
another person when the offeror knows it to be
forged?
A. Forgery
B. Uttering
C. Fraud
D. Swindle
38. Question?
What type of check is written and dated on one day
and delivered at a later time?
A. Post-dated
B. Antecedent
C. Pre-dated
D. Antedated
39. Question?
Which debit card make an immediate transfer of
money from the customer’s bank account to
the merchant’s bank account?
A. Online
B. Offline
C. Wired
D. deadline
40. Question?
Which bank is a bank by which an item is payable as
drawn or accepted?
A. Depositary bank
B. Payor bank
C. Intermediary bank
D. Remitting bank
41. Question?
A _________ check is a paper reproduction of both
sides of an original check that can be processed
just like the original check.
A. Stale
B. Substitute
C. Surrogate
D. Proxy
Editor's Notes
The bank acts as the customer’s agent when it collects or attempts to collect checks or other negotiable instruments made payable to the customer. If the items are deposited in the customer’s account, any settlement made by the bank with the customer is provisional. A provisional settlement may be revoked by the bank if an item that the bank is attempting to collect is dishonored. The bank may charge back the amount of any credit given for the item to its customer’s account or obtain a refund from its customer.
If there are insufficient funds on deposit, the bank may charge the customer’s account even if it creates an overdraft. If a bank fails to honor a check because of a mistake on its part, the bank is liable to the customer for any actual damages the customer suffers. The drawee bank has no liability to the holder of the check, however, unless it is certified.
A bank is under no obligation to a customer to pay a stale check unless it is certified. The drawee bank is not liable to a holder of a check for dishonoring the instrument unless it is certified. The holder’s recourse is against the drawer or indorsers on their secondary liability.
In any event, a bank may pay or certify checks for 10 days after the date of death of the drawer. This rule permits holders of checks that are drawn shortly before the drawer’s death to cash them without the necessity of filing a claim with the court handling the deceased’s estate.
A forgery is committed when a person fraudulently writes or alters a check or other form of negotiable instrument to the injury of another. The commission of forgery is a crime, subject to a fine and imprisonment. If a bank, in good faith, pays the altered amount of a check to a holder, it may deduct from the drawer’s account only the amount of the check as it was originally written.
With exceptions, funds from checks drawn on the U.S. Treasury or any state or local government and any bank draft, cashier’s check, or postal money order must be made available on the next business day following the banking day of deposit; funds from checks drawn on banks within the same Federal Reserve district must be made available within two business days following the banking day of deposit; and funds from checks drawn on banks outside the bank’s Federal Reserve district must be made available within five business days following the banking day of deposit.
Getting Students Involved
The Federal Reserve Bank, under Alan Greenspan, was very active in trying to regulate the economy to protect against inflation. Have students research the Federal Reserve’s actions during the past 20 years and then have them debate whether they think the Federal Reserve’s monetary policies have helped or hurt the national economy.
Payor banks are required to either settle or return checks quickly. If they do not do so, they are responsible for paying them. If the payor bank is not the depositary bank, it must settle for an item by midnight of the banking day of receipt.
Depositors, in general, owe a duty to the banks in which they have checking accounts to have sufficient funds on deposit to cover checks that they write. They must also examine their bank statements and canceled checks promptly and with reasonable care and notify the bank quickly of any discrepancies.
Most states have statutes making it larceny or attempted larceny for a person to issue a check drawn on a bank in which the person has insufficient funds. Such statutes usually have the following provisions that must be observed in the prosecution of anyone issuing a bad check, sometimes called an NSF check; The payee has the obligation of informing the drawer of the nonpayment of the check, together with notice of the provisions of the bad-check law and of the party’s legal rights and obligations. After receiving notice of nonpayment, or dishonor, the drawer is given a specified number of days, usually five or ten, in which to make the check good, without fear of prosecution. Failure to make full payment of the check within the number of days allowed by statute serves as presumption of guilt that the drawer issued the check with full knowledge of the facts and with intent to defraud.
Teaching Tips To facilitate class discussion, obtain copies of your state’s criminal code that applies to writing bad checks and distribute the copies to students. Invite a prosecuting attorney to discuss policies of his or her office with respect to bad checks and explain what fines, restitution, and jail penalties are possible for those charged with passing bad checks.
The exact time within which a depositor must notify a bank is not established except in the case of the same wrongdoer forging or altering more than one check. In that case, the bank must be notified of the wrongdoing within 30 days after the depositor receives the bank statement.
A bank may charge a postdated check against a customer’s account unless the customer has notified the bank of the postdated check within a reasonable time for the bank to act on it. Any such notice by a customer to a bank is effective for the same time periods allowed for stop-payment orders, discussed subsequently. If a check is undated, its date is the date that it was first given to someone.
If a bank fails to stop payment on a check, it is responsible for any loss suffered by the drawer who ordered the payment stopped.
The bank, may take the place of any holder, holder in due course, payee, or drawer who has rights against others on the underlying obligation. This right to be substituted for another is known as the bank’s right of subrogation. It is designed to prevent loss to the bank and unjust enrichment to other parties.
During the bank collection process, banks are described by different terms, depending on their particular function in a transaction. Sometimes a bank takes a check for deposit. At other times, it pays a check as a drawee. At still other times, it takes a check for collection only.
During the bank collection process, banks are described by different terms, depending on their particular function in a transaction. Sometimes a bank takes a check for deposit. At other times, it pays a check as a drawee. At still other times, it takes a check for collection only.
People can go to automatic teller machines (ATMs) 24 hours a day to make bank deposits and withdrawals. They can pay bills by phone, have deposits made directly to their bank accounts, and pay for retail purchases directly from their bank accounts. Some banks have arrangements for payment by e-check (sometimes called electronic check conversion), which is a system in which funds are electronically transferred from a customer’s checking account, eliminating the need to process a paper check.
Under the new law, banks are not required to use substitute checks, but when they do so for consideration, they make the following warranties:
• The substitute check contains an accurate image of the front and back of the original check.
• It is the legal equivalent of the original check.
• No drawer, drawee, indorser, or depositary bank will be asked to pay a check that it already has paid.
Teaching Tips Have students bring in several of their own canceled checks. Select a few of them to diagram on the board the various institutions through which the checks have been. Then have the students discuss what steps in the cycle are common to all checks and what steps are not as common.
If the consumer makes a claim within 45 days after receiving the bank statement or substitute
check, the bank must investigate it and make any necessary recredit to the consumer’s
account. If the bank needs more than 10 days to investigate and resolve the complaint, it must
recredit the consumer’s account for an amount up to $2,500 while it completes its investigation.
The bank must recredit any remaining balance greater than $2,500 no later than 45 days
after the consumer submits the claim.
To protect consumers from losses related to substitute checks,
the Check 21 Act includes a consumer’s right to claim an expedited credit
If the consumer makes a claim within 45 days after receiving the bank statement or substitute check, the bank must investigate it and make any necessary recredit to the consumer’s account. If the bank needs more than 10 days to investigate and resolve the complaint, it must recredit the consumer’s account for an amount up to $2,500 while it completes its investigation. The bank must recredit any remaining balance greater than $2,500 no later than 45 days after the consumer submits the claim.
A debit card offers less protection than a credit card. Unlike a credit card, a debit card payment cannot be stopped if a purchase is defective or an order is not delivered. In addition, your liability for the unauthorized use of your ATM or debit card is limited to $50 only if you notify the issuer within two business days of the loss or theft of the card. Your liability increases to $500 if notice is delayed beyond that time, and it becomes unlimited when notice is not given within 60 days. The unauthorized use of an ATM card is a criminal offense punishable by a $10,000 fine and/or 10 years in prison.
The correct answer is “C” – six months. See next slide.
The correct answer is “B” – uttering. See next slide.
The correct answer is “D” – antedated. See next slide.
The correct answer is “A” – online. See next slide.
The correct answer is “B” – payor bank. See next slide.
The correct answer is “B” – substitute. See next slide.