Mobile Check Deposit Issues
Many banks are providing customers the new popular feature of depositing checks through a smartphone. Customers use a mobile app to take a picture of a check with their phones or tablets and deposit the money into their banks accounts. This process is known as remote deposit capture and about three quarters of the largest banks offer this option.
While the mobile check deposit is convenient, there are some potential drawbacks. It is important for customers to compare the terms of mobile deposit services that different banks offer. The comparison is not always easy, as disclosures by banks vary and are sometimes vague or incomplete. Also, some banks put the information, regarding mobile deposits, online, while others put the information within the app. A potential drawback is that some banks do not offer immediate availability of funds deposited by smartphone. This delay, along with limits on the amount that can be deposited using a mobile phone, is to protect against potential fraud. Fraud can occur with mobile check deposit, partly because the customer retains the original paper check which can be re-deposited. Fraud related to mobile deposits have been rising as the service grows.
Some questions are important to ask if using a mobile check deposit app:
Q: How should I sign my check when using a mobile deposit?
A: Check with you bank for it’s specific requirements. Also, adding the phrase “for mobile deposit only” is a good idea. This helps reduce the chance that someone could try to cash or redeposit the check.
Q: How long should I keep a paper check after I’ve deposited it using my phone?
A: It depends on the bank, so you should follow your bank’s rules and keep the check in a safe place after you deposit it.
Q: How soon after I deposit a check using my phone are my funds available to me?
A: This may vary as well. Some banks offer immediate access to funds, but some may charge a fee for the service.
Henrichsen Siegel’s bank negligence practice prosecutes claims against financial institutions for bank negligence and other negligent business practices. Henrichsen Siegel’s attorneys are licensed to practice in Washington, D.C., Florida, Georgia, Maryland, New York, New Jersey, and Virginia, with offices in Washington, D.C., in Miami, Daytona Beach, and Jacksonville, Florida, and New York, NY. Contact Neil L. Henrichsen regarding your specific situation at nhenrichsen@hslawyers.com.