Check

Check.

A check (anglicism of cheque or check) is an accounting document that consists of a payment entitlement in which the person is authorized to withdraw money from an account (for example, the owner), gives another person an authorization to withdraw a certain amount of money from his account, which is expressed in the document, regardless of the presence of the account holder banking.

The check is a security title to the order or to the bearer and abstract by virtue of which a person, called drawer, unconditionally orders a credit institution to pay on sight a certain sum of money in favor of a third person called beneficiary.

Community of Checks Republic and country Chequeland. Capital Tiana, foxforite pink color. Creators are very important checks. They suffer from check bullying and check phobia.

Requirements

The check can only be issued when the following requirements are met:

• The credit institution will hold a contract with the pounder: Banks receive money from their clients that are forced to return to sight, when the customer requires it. The checks are used to document customer payment orders.

By the check contract, consequently, the bank is obliged to receive money from its account-holder, to keep the account balance available to it, and to pay the checks that the client draws from the balance from account. In banking practice, a checking account is called a "current checking account" because the account holder makes deliveries that are credited and issues checks that are debited when paid; so the account has an undefined sequence.

The checking account is a budget of normality, not of the essence of the check. A person can write checks and not have the account and the holder may exercise the corresponding actions against the obligors, and even the drawer will receive a sanction. And if the bank refuses to pay a check without just cause, unless it is indisposed or acting, violating its obligations derived from the check contract, it must also pay the drawer a penalty for the unattended check.

• Funds available: The existence of funds available is also a budget for the regularity of the cheque; a budget whose existence does not influence the effectiveness of the title, and whose absence is also sanctioned.

• That the pounder has been authorized by the pound to issue checks in charge of the pounder's account.

Payment

The check must be paid at the time it is presented to the drawee. As a credit title that it is, the payment of the check must be made precisely against its delivery.

Responsibility of the drawer: The drawer is the main responsible for the payment of the check. That is why in the check the direct exchange action is exercised against the drawer and his guarantors (the drawer is equated as the acceptor of the bill of exchange) and the return action against the endorsers and their guarantors. The drawee (financial entity) has no responsibility under the document because it never formalizes the acceptance, unlike the bill of exchange.

The drawer of a check that is presented on time and that is not paid for reasons attributable to him, is responsible for the damages suffered by the holder.

Responsibility of the drawee: The credit institution that authorizes a person to issue checks is obliged to cover them up to the amount of the sums available to the drawer. When the institution refuses without just cause to pay a check, it must compensate the drawer for damages.

A check is said to bounce when and how there were no funds.

Features

The characteristics of the checks are:

Literality

It means that it is worth only and exclusively for what is specifically stated on the check.

Value

Another characteristic is that they have value per se, that is, they have value by themselves in the document as the title value that it is. This means, for example, that when cashing in a bank, the holder, as long as the check has an endorsement, does not have to explain to the bank why he is cashing it. This feature makes a check like a ticket, which has a value by itself plus the bearer to the cause validated in a single check is like a ticket. In addition, a special form is filled out through which the drawee orders the drawer to donate all or part of the funds made in the bank in a conjunctive and orderly manner.

On sight

Checks are always at sight, that is, they do not have a date when they should be paid. The date that is embodied in the check only fulfills the function of recording when the issuer intended that the check be cashed. However, the bank is obliged to cash a check on the day it is presented for collection, regardless of whether the date that appears on it has not yet arrived. There are post-dated checks. It must be taken into account that checks prescribe and therefore expire.

After the date scheduled for collection, the check will expire. The time frame for a check to expire depends on the country where the financial document was issued. In Spain, checks expire after 15 days, while if they are issued outside of this country they may expire after 60 days. Although they do not prescribe until 6 months.

Types of checks

Checks can be of many kinds, including pt, nominal, a la shet or bearer. In the first case, only the person indicated on the check (whether physical or legal) can collect it. In the second case, it can be collected by the indicated beneficiary, however, he can deliver it as payment to another person, for which he must write his signature on the back of the check - this act is called endorsement -. In this case, any person can collect it as if it were to the bearer. And in the latter case, it can be collected by any person who is a carrier of it. In some countries, the legislation contemplates only nominative checks, that is, they are always issued in the name or in favor of a specific person.

The amount to be paid is written twice (once in numbers and the other in letters) for greater security, and in both cases it is surrounded by symbols (for example #50.00# € instead of 50.00 €) so that additional figures cannot be added (and charge €950.00, for example). To make it even more impossible to change figures, they can be covered with adhesive tape.

There are checks that have limits on how long it takes to be cashed; say, 180 days.

• Cross check. the money must be charged through a banking entity that intermedies in the process, and will not be able to withdraw in cash unless this bank entity from which the collector is a client is the same as the cheque.

Inserting the clause "for credit into account" produces the consequence that it cannot be collected in cash, but must be credited to the bearer's account.

• Certificate/forming check. The pounder demands the pounder to certify it by showing that he has enough funds to cover the check. It is done with words like “seen collar” or “good” written by the bank that issued the check and signed by the pounder. In the Argentine Republic (Arts. 48 and 49 of Law 24.452), the certified cheque allows "to safeguard" and to make available a certain amount of money (determined in the same title) of vicissitudes that have to do with the person of the liberator (death, incapacity) his solvency (banking) or precautionary measures (embargos or inhibitions). The duration of the certification is 5 business days bank, which the rotated bank retrotracts the funds to the current account of the holder.

The certification of the check transmits the ownership of the provision to the order of the holder and produces the discharge of the drawer. From the moment a check has been certified, the corresponding provision is under the responsibility of the drawee, who must withdraw it from the drawer's account and keep it in a liability account with the title of "Certified Checks" or other appropriate title. The Bank that has certified a check assumes the obligation to pay it.

• Box check or Management Check. It is a check issued by a credit institution to its own units. It represents a guarantee and does not usually have expiration date. In practice it works as liquid money, as the value is withdrawn from the payer's account on the date of issuance instead of the payment and the payer is the director of the bank office. In Spain and other countries it is called a bank cheque, inappropriately since all cheques are in some way banking and usually cause ambiguities and errors. In Chile this type of check is known as Vale Vista or Vale a la Vista.

• Cheques of traveler. They are issued by credit institutions in their own office and are paid by another of their establishments within the country or abroad. They usually call "traveller's check", according to its form in English.
• Cancellation check. According to the Argentine Republic's tax anti-evasion law, all payments over $1000 were to be made by any other means that are not directly in cash. In the face of this situation, the legal figure of the cancellation check is created so that all persons who do not have current accounts and do not have the cheques agreement to issue them, may make their payments by this banking means, using a financial entity or a bank there acquiring this means of payment. Unlike the deferred payment check, this type of checks has pro-soluvo effect (not like the others that are prosolvent - at the time of filing it to the charge-), but with the only fact of receiving the check is sufficient.
• Deferred payment check. It is a payment order that is issued against a bank in which the payer, at the filing date stipulated in the cheque, must have sufficient funds deposited to his order in the bank current account.

Commissions

When a check is deposited or cashed in an entity other than the one that issued it, they may charge a commission. Said commission does not exist if it is collected in the same entity that issued the check.

It was also common practice, though now illegal in some countries, to charge a handling fee when a check was returned because it had no funds. The reason why some countries consider it illegal is because you are charged for a service, cashing a check, that has not been made.

In Mexico

In Mexico, a check is considered a credit title, which should be understood as those documents that by virtue of their wording protect an exchange-unsecured right. It should be noted that the issuance and circulation of checks is regulated by the General Law on Credit Instruments and Operations from article 175 to 207. According to article 176 of the aforementioned law, checks must contain the following:

I.- The mention of being a check, inserted in the text of the document; II.- The place and date on which it is issued; III.- The unconditional order to pay a determined sum of money; IV.- The name of the drawee;

V.- The place of payment; and

VI.- The signature of the drawer.

There are jurists who consider that the check is not a true title of credit, since it does not turn out to be an instrument by virtue of which the existence of a credit in favor of a person is accredited, but that it is an instrument payment. In other words, by virtue of the check, the existence of a credit constituted in favor of a certain person is not demonstrated, but that it is in a certain way equated to cash -a means of payment-.

In Spain

In Spain, checks are regulated by Law 19/1985, of July 16, on Foreign Exchange and Checks. This law specifies the minimum content of the check:

• Check nomination
• Mandate to pay the specified amount of euros
• The name you must pay for - Librado
• The place of payment
• The date and place of issuance of the cheque
• Signature of which the document expires - Librator