Institution Postdating Cash Credit

Forum|Forum|2 years ago
June 30, 2023
1 reply
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I am formulating a complaint to a federal financial regulatory agency and I want to ensure my complaint is very clear, especially in terms of how a credit to an account must be dated, whether legally or in terms of mandated accounting standards (e.g., GAAP or IFRS).

However, I first want to be reasonably sure there are no legitimate reasons whereby an institution may change the date of a cash deposit where the credited funds are immediately available for withdrawal (i.e., no holds). Any comments would be appreciated.

Not A Product Question

Anonymous_

You may have to post more details in order to get a useful and accurate response.

However, is this question related to those posed in your previous posts?

Quentin818Author

Hello, yes, my post is tangentially related to a previous Jan 2022 discussion. I am working on this from a different angle trying to understand the rules for dating an account credit by a financial institution. I am curious to know whether the below hypothetical example of how a deposit is credited might or might not violate some accounting principle or other rule (e.g., IRS, FDIC, etc.):

-A cash deposit is made on a Saturday and becomes immediately available for cash withdrawal

-The institution dates the credited deposit amount for the following Monday on periodic statements

And, the days of the week could just as easily be Tuesday with a Wednesday record date.

NCPERSON1

@Quentin818 - I am confused by what you issue is.

"Saturday" is not a "banking day". A "banking day" are days when the Federal Reserve is open and it only operates Monday - Friday, except for Banking Holidays.

from Reg CC

§ 229.10 Next-day availability.

(a) Cash deposits.

(1) A bank shall make funds deposited in an account by cash available for withdrawal not later than the business day after the banking day on which the cash is deposited, if the deposit is made in person to an employee of the depositary bank.

(2) A bank shall make funds deposited in an account by cash available for withdrawal not later than the second business day after the banking day on which the cash is deposited, if the deposit is not made in person to an employee of the depositary bank.

Read through Reg CC which governs timeliness of deposits.

https://www.federalreserve.gov/pubs/regcc/examples.htm

further, your post makes the false assumption that cash deposited on a Saturday becomes immediately available. While that may be a specific Bank's policy and the experience at your Bank, it far exceeds the Regulatory requirement that it be made available on Tuesday. The Bank can accept the deposit on Saturday and not make the money available until Tuesday and not run afoul of any regulatory issues.

When you state 'cash', do you mean 'greenbacks' or a check?