Bank Responsibilities

Banks are really the ones that stand to gain the most from the Check 21 Act. The ability to use substitute checks means greater processing efficiency and lower costs—which, by the way, the banks aren't required to pass on to customers. It only stands to reason, then, that Banks should be held to a higher standard of accountability. You should have already received a notice from your bank or credit union explaining the legal status of substitute checks. A bank or credit union that uses substitute checks is also obliged to reaccredit any disputed amounts to a customer's account—up to a $2,500 maximum—within ten days of receiving written notice of the dispute from the customer. If the disputed amount exceeds $2,500, the bank has to make good on the full amount within 30 calendar days of first receiving written notice of the disputed amount.