Business Credit Reports

Unsigned Check? Don't Return It!

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"Whether a mistake is intentional or unintentional, we do not allow incorrect checks to tie up our cash flow," says a Texas credit manager we know, who never returns a check to a customer. Instead she sends the following letter:



Thank you for your check #3410 dated January 28, 2011, in the amount of $585.38.

While processing this check through our accounts receivable department, we noticed that it was not signed. However, since we are entitled to the proceeds of this item, we continued to process it with the notation, "Signature guaranteed by ____________c." Would you please instruct your bank to process this check when it is received?

Thank you for your cooperation in this matter and past good business. Please let us serve you again soon.


"Everyone involved in the transaction--the customer, the customer's bank, and our own bank--is informed of the error and how and why we corrected it," she says. "The letter, along with a copy of the corrected check, is sent to the customer and to the paying bank. A copy of the letter is also attached to the corrected, endorsed check, which is then placed for deposit.

"For unsigned checks, our guarantee is typed on the signature line. For checks with varying amounts entered in the numerical and written sections, we correct the wrong amount with the notation Correct amount guaranteed to be (amount). Of course, I adapt the customer's letter to fit each error," she says.

"I've never had a customer or a bank question or return a check that is handled in this manner," she concludes. "After all, we are only correcting and guaranteeing that to which we are entitled."

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Circumstances Would Dictate    
February 7, 2011
By donabirtwistle - See all my comments    
This is first time I have ever heard of using a letter of this type. When a check is received that is missing a signature or body and numbers differ, whatever the circumstances are, an immediate telephone call is maid to the customer. The customer is expected to replace the check the same day. The incomplete check is not returned until the replacement arrives via courier or by mail depending on the amount of the check in question. At the end of the day, I do get a replacement one way or the other.
I have never had the experience where the check was not replaced. The letter maybe useful where there is a large volume of checks of this type. but it does seem like a lot of work.

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