high street shops the change cheques

  acein1 19:56 17 Dec 2009

hi, anyone know how this works, its pretty obvious that the charge a % for cashing them,but i want to know how they can bank a number of cheques all with differant names on them.
a friend of mine with a local shop used to change a small one for me now and again,but he tells me now that his bank will only accept cheques that are made payable to him personaly.
im sure you all come accross these shops in you locality,??? im just wondering how the manage to do this

  lotvic 21:01 17 Dec 2009

some sort of arrangement with their bank I think.
Some info from BBC click here

  acein1 21:08 17 Dec 2009

lotvic, thanks for that, interesting link, first time i read any explanation of how its done cheers

  BT 08:13 18 Dec 2009

A friend of ours had a problem just this week. She was sent a cheque that was made out to Mrs*** instead of Miss*** and the bank wouldn't accept it even though her name was spelt correctly. I think this was very petty. I know the banks have their rules but this sort of thing is going a bit too far especially as she says they have accepted cheques with slight variations of her name on other occasions. She has had to get the cheque re-issued with the correct spellings.

  oresome 16:56 18 Dec 2009

My wife is Mrs J Oresome, whereas my daughter is Miss J Orsome. Two different people, so the banks action seems correct.

My wife and I don't have a joint account. We sometimes get cheques made payable to Mr & Mrs Oresome and neither of us can pay the cheque in to our indiividual account.

  BT 17:11 18 Dec 2009

So if your wife and daughter spell their surname differently, I can't see the problem ;-)

Personally if I write a cheque to someone I tend to write their name, ie Joe Bloggs rather than J Bloggs and never use the salutation. If I'm paying someone I don't know, say a plumber, I always ask how they want it made out.

  QuizMan 21:52 19 Dec 2009

An interesting link, but I really do not understand how a cheque cashing agency can be allowed to undertake this practice. Unless they are a clearing bank themselves (unlikely), they will still have to pay the cheques through their own bank account. However, the cheques are crossed "account payee only" so must be paid into the account of the named payee. Otherwise they go against the instruction from their customer and this is completely against the basic banker/customer code of conduct.

Legally we are still governed by the Bill of Exchange Act 1884 and the Cheques Act 1967, both of which should prevent this happening. A cashing agency may well have some form of indemnity arrangement with their bank, but I fail to see how it circumvents the legal position.

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