Credit Union trying to make us pay twice for same check!

marylmiDecember 5, 2007

Anyone have any ideas on this problem?

My husband cashed a pension check in September that unbeknowns to him was dated July of 2006. The credit union cashed it and it came back stamped "Payment Stopped". Credit union then took the money from our account to cover the check. We then called GM and they sent a replacement which we cashed and thought everything was ok. Credit union called just two days ago and said they got the check in and we owe the money for it AGAIN! They said the check was stamped "Copy, in leu of"???- I don't remember her exact word. It was the same exact check from July of 06 with the same check number on it. I told her that it had already been dealt with back in Sept/Oct. and we didn't owe anything and she said since it was in my husbands name that we are responsible and they wanted their money as the Federal Reserve wanted their money. According to GM, they have done their part and this needs to be worked out with the credit union & said it sounded like the credit union had messed up somewhere. Credit union has said they will freeze the account until this is resolved and I told her we have bills coming in that need to be paid and we don't want any checks bounced. Our next step is to see a lawyer if the situation can't be resolved. Anyone have any ideas what could be the problem with that check coming back to their office again?(checks are void after 90 days- I know we should have caught that)

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Was the first check sent for a missed pension check in July , 2006? I would have thought that a missed pension check would have been noticed? Or did GM mis-date the check?

Did you ask GM why they stopped payment on the check?

It sounds like GM sent you a copy of the original check. Copies can't be cashed.

There are too many unanswered questions here.

    Bookmark   December 5, 2007 at 9:48AM
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The check dated July of 2006 was his regular check for that month. It was put away and was actually forgotten about until this fall. After it was cashed in Sept. of 2007, it came back as "payment stopped" because it was from last year and they are only good for 90 days. The credit unions shouldn't have cashed it as it was outdated. Gm sent us a replacement check -NOT a copy- it had it's own check number and was a replacement for the July 2006 check. BUT now, the JULY 2006 check came back to the credit union marked as as "Copy, in leu of?" can't remember the word she said. Hope I'm explaining this!

    Bookmark   December 5, 2007 at 10:11AM
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Chemocurl zn5b/6a Indiana

Wow, it sure sounds like a misunderstanding and lack of communications.

"Copy, in leu of?"
Possibly better wording on GM's part would have been this replaces check #XXXXX.

Might you or someone you know have 3 way calling on your phone. I have found it is very helpful for occasions such as this...and often for helping an elderly friend 'straighten' things out. If you could get the CU and GM Payroll on the line at the same time, possibly you could all get on the same page.
If you don't have access to 3 way calling, you might talk to someone at GM (of course note name and everything that is said) and then ask that they call a particular employee at the CU...someone that you have talked to that is familiar with the situation.

Hopefully you have some 'emergency' money you could move into the account to handle the bills until this all gets straightened out. I really don't know if GM is liable for the money, since it has been so long, but hopefully they will be nice and work with you on this.

Am I understanding this right? They put the money in twice, and the first time they withdrew it from your account, and now they are trying to withdraw it again? In other words you aren't really paying for the check twice, but just having to give it back twice after they gave it to you twice? In other are still needing a 'good' check from GM. If/when you get another, I would take it in and deposit it via someone who is familiar with the whole situation. Getting a lawyer involved would likely eat up the whole check amount and accomplish nothing.

Good luck!


    Bookmark   December 5, 2007 at 11:59AM
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Sue, no we weren't paid twice for the check. When we first cashed the July 2006 check,in Sept., we got cash for it, then the credit union called and said the check came back as "payment stopped". They then took the amount of the check from our savings account, which was ok with us. We called GM and they said they would re-issue a check to us, which they did and we received that in October. We then cashed that check and everything seemed to be ok. THEN....several days ago the credit union called and said that they had a check from July 2006 marked "copy, in leu of... and they wanted their money. We didn't get that check, they did for some reason. Now they claim we or GM owes them the money. They have already taken their money out of our account once for that check and I don't see where we owe them anything. The October check went through ok, it is just that old one from July that popped back up. There was no money put in our account from the last July check that popped up a few days ago,so how do they think we owe them money? Yikes!!!!

    Bookmark   December 5, 2007 at 3:44PM
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And yes, we all did talk on the phone(DH,myself, credit union and GM rep)as Gm won't talk to them unless DH is on the phone also. The gal from GM said afterwards that she really didn't understand what the problem was with the credit union and she was going to get in touch with another dept. at GM and let them handle it. She had the credit union fax GM some papers We did talk to GM yesterday and the rep said that they have done their part and it was now up to the credit union and Federal Reserve to find out where the problem was and that they had sent us a letter on Monday of this week stating that. We haven't received the letter yet, maybe tomorrow. I was telling a friend of ours about it and she worked at a bank for quite a few years and has offered to go with us to the credit union to see if this can be straightened out. We are not going to cover that July 06 check again since we have done it once already so may have to take it all to a lawyer. We have lawyer service through GM so won't cost us anything but our time.
Worst part is all this time 25 yrs., DH has had the GM checks mailed to him and as of December 1st. we started having them direct deposit to the credit union. May have to change that!!!

    Bookmark   December 5, 2007 at 5:02PM
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BTW, that's 'in lieu' of - it's French for 'in place of' ("in lyoo of").

    Bookmark   December 6, 2007 at 4:38AM
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But you repeatedly say you cashed the first check, yadda yadda, then you cashed the replacement check--so you DID get the money twice. And if the second check is no good, the bank needs to have the money returned.

Look, I know you probably want to hear differently, but you and your husband were the ones who dropped the ball by not cashing the original check in a timely manner. And come on--are you trying to say you weren't trying to pull a fast one when you tried cashing a check that was more than a year old? You were just hoping it would slip through the system unnoticed--everyone knows you can't cash a check that old. Sorry, you tried, it didn't work, and now you have to take the consequences. It's not the bank's fault you hid that check for over a year. You might try going to small claims court--you won't need a lawyer for that--against GM to get a current replacement check that you'll be able to cash properly.

For the future, what about having the pension directly deposited? Or do you have financial claims (IRS, court-ordered back child support, etc) against you where you are afraid others will be able to access the money if you have it in the bank?

Seriously--there's something wrong with this story. Getting a pension check rather than direct deposit (not unheard of, but rare these days). 'Forgetting' one for over a year. Trying to cash a check that's obviously past the expiration date.... Sorry, but there's more to this story than we've been told, I'm afraid. I'm truly not trying to be nasty, just reading this saga and seeing things that simply don't add up.

    Bookmark   December 6, 2007 at 8:33AM
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zzalea, sorry but you are waaaay off base! Not everyone in this world is trying to pull a scam!! My husband has never wanted to have his checks direct deposited and has always had his pension check and social security check mailed to our address. And as far as forgetting about that check for a year...yes it certainly did happen that way. Yes, we should have caught that and it's funny GM didn't catch that one of the checks hadn't been cashed also. Sometimes we would have several checks on hand(not smart, I know, in case of fire,etc.) so this one somehow got shuffled to the bottom amd was overlooked. We have a small safe that we keep bank books, papers, and we put checks in it too from pension, selling calf, or what ever instead of always running to the bank as we are out in the country SO it sure was a HONEST mistake and there are NO claims against us for anyone wanting money. Sometimes honest mistakes happen and we are certainly not trying to pull a "fast one on ANYONE! Sorry you got it wrong!
As far as "everyone knows you can't cash a check that old" I sure wish we would have noticed it or I should say DH as he was the one that got it out (blame it on him!) and also the credit union should have noticed the date. I WISH someone would have noticed the date as it is turning into one big mess!!! My gosh, do you think we would actually have taken it to be cashed if we had seen the date on it??? NO..we would have contacted GM. Please give us a little credit!!!!!!
Yes, we cashed that first check, BUT they took the money BACK out of our account. We then cashed the replacement and that seemed to go through ok.. Now, that original July 2006 has resurfaced at the credit union marked "in lieu of" (thanks Lucy) and they say they are out their money but also say there wasn't any money put in our account for that "in lieu of" check that just came in. NOW, if they had AGAIN put money in our account for that, I could see where we would have been paid twice for it,BUT they say they haven't.

    Bookmark   December 6, 2007 at 10:14AM
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When the CU took the money back, they must have sent it back to GM. So doesn't GM still owe you for that amount?

You don't say why your husband is so adamant about not having direct deposit, but direct deposit would have avoided the whole problem in the first place.

    Bookmark   December 6, 2007 at 10:31AM
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And... the money that the credit union took BACK out of our account when the check first came back as "payment stopped"....doesn't that count for anything?????? It sounds like the credit union is trying to get their money Twice for it!
I'm not a banker so don't know WHY that July 2006 check came back to the credit union recently or where/who shipped it back! Like I say....a mess.

And also Azzalea, we had started just this month having the pension check direct deposited to the credit union....boy, that was certainly BAD timing!!!
BTW,anyone know the path a check makes from an institution after it has been cashed????

    Bookmark   December 6, 2007 at 10:38AM
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(I have deposited more-than-a-year-old checks and had them clear; I can understand why your DH did this, as well as him not noticing. Also, my next-door neighbors were getting old a senile, and didn't cash pension checks; they got a letter saying "did you get your check? it hasn't been cashed? but it was many months later, and it was several checks still on the DR table, not one check)

when they took the money out of your savings account, did they give the "defective" check back to you? Shouldn't they have? Demand it be returned to you. (a lesson to us all--if we are giving a bank money back for a check, we should get the check physically returned to us)

Unless they submitted it all over again?

Here's what I think happened, if I understand this right. (some queries, though)

1. You give them a check, they give you cash.
2. They send the check to the central clearing house (the Federal Reserve?) to get their money.
3. The central clearing house gives the CU its money, and sends the check on to GM to get the money back from them.
4. GM sends the check--but no money--back to the central clearing house as "defective"'; the central clearing house is still in need of money.
5. The central clearing house sends the check back to the CU as "defective" and wants its money back from them. I would think the CU would have an account of money it would use to cover this; it pays the central clearing house, and the central clearing house is out of it.
6. the CU brings the check back to you, and says they want that money back; they take it out of your account. THEY SHOULD GIVE THE CHECK BACK TO YOU--it is your property, once they have their money back. At the very least, they should have destroyed it, but really they should have given it to you so YOU could destroy it. I'm thinking this is where the CU goofed, and I'd press this point.

7. You get a replacement check, and submit it, and the "you to the CU to the central clearing house to GM" chain works, this time. (can you get the folks at GM to send you a copy of their canceled check, the replacement one that supposedly worked just fine? Might be nice to have)

Suddenly the old "defective" check is around. (Sometimes if a check is returned for "insufficient funds," the bank will resubmit it, just in case the money will turn up. They will bill the depositor $15, and then if it's returned twice, they'll bill another $15; the check-writer's account will get billed as well each time; this was unpopular, so some banks don't make a second attempt. I'm wondering if your "defective" check got slipped into the "insufficient funds" category and was REsubmitted?

So, let's postulate:

8. The credit union resubmits the check to the central clearing house (Federal Reserve?) to get the money. BUT IF THIS IS THE CASE, then they should have RECREDITED your account when they RESUBMITTED the check. (because if they don't give you any money, then they shouldn't be getting any money from anyone else--it's not their money, it's yours, they're just the "pipe" to move it around) Did they? If you can get them to trace their records of when the check was submitted, can you insist that they DO credit your account w/ the money, on that day?

9. The clearing house (FR?) gives the CU the money, and sends the "defective" check on to GM.

10. GM marks the "defective" check w/ a confusing note that was *intended* to indicate that this check has been replaced w/another check, and sends it, but no money, to the clearing house (FR?)

11. The clearing house sends the check back to the CU, demanding its money back.

12. The CU comes to you demanding the money that it owes to the FR.

So, did they "give you money" for that check twice (once in cash, once by crediting your account)? No, you say--but if this is what happened, then they should have.

Or else someone put that check in the wrong stack somewhere--and I'd want to SEE that check, and I'd want to try to figure who where the "in lieu of" came from.

So they should have given you money twice, and asked to get money back from you twice.

Maybe if that's the chain of events, you can make them re-credit your savings account w/t he money they owe you from having resubmitted the check (treating it as though you deposited it all over again), and then they can take it back out again.

Good luck!

    Bookmark   December 6, 2007 at 12:48PM
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I'm not a banker so don't know WHY that July 2006 check came back to the credit union recently or where/who shipped it back!
I can explain this (although Talley Sue also did it very well).

First you must remember that a check is not the same as cash...a check is a promise to pay, not actual funds. When you deposit a check at the teller window, many banks give you immediate credit to use the money as a courtesy to you. Think of it as a loan until the check clears.

There are two things about checks you should remember.1. A check is nothing more than a formal IOU. 2. You do not actually have cash as the result of depositing a check until the check clears the system.


Your Bank----->Federal Reserve Clearing---->Paying Bank
Paying Bank----->Federal Reserve Clearing--->Your Bank--->CASH

The paying bank is the bank that the check was drawn on...GM's bank.

So, you deposit your check at your bank. Your bank sends it through the Federal Reserve system; the Fed routes the check to the Paying Bank. The Paying Bank then either sends CASH to the Federal Reserve, who in turn sends CASH to your bank (this is the point at which you now have real cash in your bank account); OR the Paying Bank refuses to pay the check.

It sounds to me like the original check was refused by the Paying Bank because it was old. This is also called stale-dated. Stale dating is usually stipulated by the account owner, in this case GM. It does not sound to me like the check was refused by your bank.

Based on the rest of your story, it sounds to me like when you submitted the deposit for the second check, the Paying Bank (GM's bank) once again refused to send funds to your bank.

I think you should be angry, but at GM, not at your bank.

You need to speak to someone at GM's payroll department and you probably need to speak to a manager at this point. I would not accept a third check from them, I would insist that they wire transfer the funds into your account immediately (at no cost to you). I would also ask for interest on the funds from the date of the original deposit until you receive the wire transfer.

    Bookmark   December 6, 2007 at 4:26PM
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Both pension checks were cashed.
GM would not satisfy either check, so the money you received TWICE was taken against your account TWICE.
I would insist that they do the wire transfer and NOT send another check.
In the future if you do receive checks from them, DON'T cash them, deposit them and wait for confirmation that the check has cleared.
It's a shame, it only takes one person at the bank to fix it, and it's anyone's guess WHO that is... In my case they are usually out to lunch.

    Bookmark   December 6, 2007 at 5:10PM
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I do think you need to get GM to show you proof that they honored the second check--that's why I suggested you ask them for a copy of their canceled check, in "step 7." GM need to prove to you that they sent the money down the chain.

part of your solution hinges on, did step 7, with the replacement check, work all the way through? Did GM honor that check? It sounds like they did

Knowing the answer to that will help.

It sounds like GM *did* honor that check, based on your post from Wed, Dec 5, 07 at 17:02.

I think someone at the CU got confused. Get as much paperwork as you can from GM, and get your own records to show what was credited to your account, etc., and sit in the office of the CU president.

    Bookmark   December 6, 2007 at 5:52PM
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talley_sue,WOW, THANK YOU for explaining that! That helps to understand the process! Yes, we did get the July 2006 check back from the credit union. I just looked at it and at first thought it was a copy, but it looks like the real thing. I wish I would have made a copy of the check they sent us in Oct. that was supposed to be a replacement for the 2006 check. We have the stub of course but I never thought of copying it. Our account was charged $5 for the returned check. This 'original' check that I am looking at right now has the "PAYMENT STOPPED" stamped on it and tons of numbers on the back of it. The credit union said that the check that just came in recently (same date,July 2006, same check number) has a stamp on it that says "COPY- In lieu of". So if I have the original check, who made the copy, where did that come from? Thanks for all that info, I need to go back over those points. Also, if that Oct. replacement check did bounce too, wouldn't we have got it back & got another letter from them? But we never had any reason to think it didn't go through.
Cindyb, THANK YOU too, all of this info was what I was looking for to help me better understand what what going on. I am going to print the info out so I can refer back to it more easily.
We didn't receive any letter from GM today, I was hoping to get it so we could meet with the CU. I really appreciate the feedback on this and I will post an outcome on all this WHEN it ever gets settled GOOD POINTS!!!!

    Bookmark   December 6, 2007 at 6:26PM
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I am pleased that you have the paper that came through the second time.

When you receive that, or the C U has it, make sure that it is not destroyed, as it is your main proof that the action that happened did happen that way.

GM will want it before they are willing to issue a replacement, I'm sure.

You're lucky at being billed only $5.00.

I recently wrote my rent cheque when there were not sufficient funds to cover, and my credit union charged my account $45.00.

No doubt the landlord's bank charged a fee, as well ...

... so this is going to be a costly exercise for me.

My private pension cheque goes into my account by direct deposit, and it is deposited faithfully on the first of the new month.

I have two government pensions, as well, one contributory (compulsorily - everyone must join) and one that was a perq offered a number of years ago to people with a certain residence requirement ... including housewives who were never employed outside the home.

They come by envelope, and sometimes lie around for a week or so ... possibly even a month or so.

The government would rather that we had them pay by direct deposit, and that does seem to be the best way to do it. Saves postage ... and paper. And less admin. costs.

I hope that you get things straightened out without more ado.

ole joyful

    Bookmark   December 9, 2007 at 12:45AM
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Problem is solved!!!
Credit Union called today and said everything is ok. She said the Federal Reserve had REsubmitted the check! From what she said, they have re-credited our account, then they took it out again. (as talley_sue stated)

Certainly glad that is over, but I'm keeping all the paperwork that I printed out from this thread. I had different parts highlighted to show them.

Thanks so much everyone.....Merry Christmas!!!!!!!

    Bookmark   December 11, 2007 at 10:50AM
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Chemocurl zn5b/6a Indiana

Great! I was beginning if you would ever get it solved without a lawyer, as it seemed a lot of folks just did not know what was going on, thus not able to correct the situation.

Happy Days and Merry Christmas!


    Bookmark   December 11, 2007 at 10:58AM
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Great news! (Smart to keep everything for a while)
Merry Christmas and Ho,hoho

    Bookmark   December 11, 2007 at 6:36PM
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I'm so glad they sorted it out.

What a pain these things can be, esp. when the glitch is deep inside a system you aren't intimate with, and can't de-bug.

    Bookmark   December 12, 2007 at 1:26PM
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