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This is where 2 people play off on the waiting period for checks and deposits to go into banks. It's not as doable as it used to be as a lot of times money is electronically deposited in 1 to 2 days. Here's how it used to work:
My bank takes 3 days to deposit a check (and your bank does the same with checks), and I need to write a check but neither you nor I have the cash, so you write me a check for the amount I need, I write the check for whatever. Then 2 days later I give you a check deposit for the amount you wrote me, 2 days later, I put cash into my account for the amount of the check - you've used the bank's money to pay something 4 to 5 days before you actually had any cash.
It's illegal and no longer works - you might get one day out of it but the 4 - 7 days worth of time you wrongly used to get no longer is there.
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∙ 15y ago
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How kiting on cash done?
Kiting is when you write a check on an account without having funds. You receive cash without having the funds to back it up.
What can a company do to prevent kiting?
Kiting is writing a bad check to get money to deposit in a bank account to cover another outstanding check. While this practice used to be very common, it is much harder to do now that so many companies process checks electronically. To prevent kiting, a company should process all checks at the end of the day.
In regards to check writing what is a worthless instrument?
Generically, a worthless instrument is a financial instrument (e.g., check, debit card transaction, stock) that cannot be negotiated. Most actions creating worthless instruments are illegal and can be prosecuted if proven to have been done knowingly. A worthless instrument as related to writing a check includes the following: * Writing a check on an account known not to have enough funds or a backstop (overdraft protection) to cover the amount * Writing a check on an account that, when the check is cashed, will not have funds or a backstop to cover the amount * Cashing a check on any date that is more than one (1) year later than the date written on the check (many banks make exceptions given correct identity information) * Writing a check on an account that is not owned by the writer (also known as forging or kiting checks) * Endorsing a check through forging the back-of-check endorsement
Is it considered check kiting when the supposed perpetrator is paying for the bank charges?
No, many banks would rather cover your check, they refer to that as being a "interest free loan". Based on the recent financial problems at banks they have been making record profits from "bank fees". If a bank customer has 20 dollars in her account and a check comes up for 100 dollars the bank can simply return the check and charge the customer a handling fee for NSF. But if the bank accepts the check and covers it they can still charge the NSF fee and charge the negative balance charge, while they wait for your next direct deposit they can also charge you a daily overdraft charge of 5 - 15 dollars per day. Now the bank has made a large profit off of a small customer mistake. What could have been a small NSF for the customer and a small NSF profit for the bank now turns into a 120 dollar profit for the bank "the interest free loan" When the deposit is made in the customers account the bank then collects the money it is owed. This has been very popular by banks, now laws have been put in place that force banks to offer a choice to customers. So a simple answer to your question would be it is not check kiting if the bank has a history of extending funds to the customer in return for charging multiple fees that have been repaid by the customer. Do the math, if you could give a 100 dollar loan and collect the 100 dollars plus 120 in fees 5 days later that would be great, and banks are doing it and it has been a blessing for banks in trouble! This rate is much higher than a payday loan company, look at the bad press they get! That is why banks are now being directed by the government that an option must be extended to the customer as to how the transactions should be handled! Next time you get a account update in the mail check over it as it could relate to this!
Why are money cheques being used less?
Money orders and checks are being used less because (1) checks are expensive (due to manual handling costs, paying for the checks themselves, bank charges for providing check imaging, etc.), (2) value derived from checks is not immediately available (though Check 21 has helped in the United States), (3) checks are insecure (there are still people who write bad checks and/or use check kiting schemes) and (4) checks don't reward the user (one does not get points or miles for using a check). The main reason, however, is that alternative payment processes are available to consumers that reduce or remove the four negatives mentioned above. Debit cards (and credit cards) have rapidly replaced checks for traditional purchases (e.g., groceries, drug stores, etc.). and the use of PayPal and other peer-to-peer payment services have replaced checks for many professional services and friend-to-friend payments. Finally, the rise of the Internet and the associated businesses have radically increased the ratio of electronic payments to paper payments.
How kiting on cash done?
Kiting is when you write a check on an account without having funds. You receive cash without having the funds to back it up.
What if you write a check to yourself on a closed account to another account?
Then you are commiting a crime known as check kiting.
What can a company do to prevent kiting?
Kiting is writing a bad check to get money to deposit in a bank account to cover another outstanding check. While this practice used to be very common, it is much harder to do now that so many companies process checks electronically. To prevent kiting, a company should process all checks at the end of the day.
What is the penalty for Check Kiting?
It is usually a state crime or may be prosecuted federally as bank fraud.
When was Rebecca Kiting born?
Rebecca Kiting was born on 1991-05-08.
If an employee who is also a check signer is directed to partipate in check kiting can the employee get in trouble?
Oh yes!. Fraud, accessory to fraud, conspiracy to defraud etc
Why is passing bad checks called kiting?
...because there are no funds supporting the check...it is only supported by AIR, like a kite.
What action can be taken in Texas if someone stops payment on a check immediately for services already rendered to them?
They can be charged with theft by deception, fraud, check-kiting (uttering), for starters.
Can i open second account after closed for kiting?
No.
What are some action verbs that started with?
kiting
Who sans culottes killed?
me ;(
What happens after check kiting is suspected and bank closes the account?
The bank who shuts down the Kite comes out best. Those banks that fail to detect the kite get stuck.
