What Happens If You Cash a Voided Check?
Understand the complete story of voided checks: why they're marked and what truly happens if one is presented for payment.
Checks are a common method for transferring funds. Voiding a check prevents its use for payment. This article explores what happens when a voided check is presented to a financial institution.
The Nature of a Voided Check
A voided check is a check that has been deliberately invalidated, usually by writing “VOID” in large, clear letters across its face. This action renders the check unusable for financial transactions, meaning it cannot be cashed or deposited for payment. The primary reasons for voiding a check include providing accurate bank account and routing numbers for setting up direct deposit or electronic payments, correcting an error made while writing a check, or canceling an intended payment. Although voided, the check still contains sensitive banking information like account and routing numbers, which are necessary for legitimate electronic transfers.
A check marked “VOID” is legally rendered unusable for payment and should not be honored by a financial institution. It acts as a template for account information rather than an instrument of value.
Bank Processing of Voided Checks
When a voided check is presented to a bank for cashing or deposit, standard procedure dictates its rejection. Bank systems and tellers are trained to recognize the “VOID” marking, indicating that the check is not intended for a financial transaction. The check lacks valid payment instructions.
Attempts to cash a properly voided check are almost universally unsuccessful, leading to the check being returned to the presenter. Even if deposited through an automated system like an ATM, the funds will likely be reversed once the check is manually reviewed and identified as void. Financial institutions will not process a check that has been invalidated in this manner.
Financial and Legal Repercussions
If a voided check is processed due to error or deliberate fraudulent action, financial consequences arise. If funds are mistakenly credited to an account and then spent, they will eventually be reversed, potentially leading to a negative balance or overdraft. The individual attempting to cash or deposit the voided check may incur bank fees, such as returned item fees or non-sufficient funds (NSF) fees, which typically range from $20 to $50.
Legal repercussions can ensue if the attempt to cash a voided check is determined to be fraudulent, indicating an intent to deceive or steal funds. This could lead to charges for check fraud or attempted theft, with penalties varying by jurisdiction based on the amount involved and the perpetrator’s intent. Such charges can range from misdemeanors to felonies, potentially resulting in substantial fines, restitution, and even imprisonment.
Actions for Check Issuers
Individuals or entities who issued and voided a check should take steps if it has been improperly processed or an attempt was made to process it. The immediate action involves contacting their bank to report the incident as potential fraud. Account holders should closely monitor their statements for any unauthorized activity.
It is important to securely dispose of voided checks to prevent misuse. Shredding is a highly effective method, particularly using a cross-cut shredder. Other secure disposal options include bleaching or washing checks to remove ink, or burning them if local regulations permit. Never simply discard a voided check, as it still contains sensitive bank account information that could be exploited.