Certified Check

(redirected from Cashier's Checks)
Also found in: Dictionary, Thesaurus, Financial.
Related to Cashier's Checks: Official check

Certified Check

A written order made by a depositor to a bank to pay a certain sum to the person designated—the payee—which is marked by the bank as "accepted" or "certified," thereby unconditionally promising that the bank will pay the order upon its presentation by the payee.

A certified check is considered the equivalent of cash since the bank, by its certification, guarantees it to be cashable. No bank is under a duty to its depositors or anyone else to certify checks since it involves the assumption of a new obligation for which it is primarily responsible. It is a commonplace practice, however, and there is usually a small fee for this service. A certified check is often required by a payee who does not want to rely only upon the credit of the drawer, the person who wrote the check.

A payee who requires a drawer's check to be certified ensures his or her right to payment. Not only can the payee seek payment from the certified bank, but if for some reason the bank refuses to pay, the payee retains the right to enforce payment from the drawer. In this situation the bank is primarily liable while the drawer is secondarily liable.

Occasionally the payee or subsequent holder of the check—a person who has been legally given possession and the right to payment—will present the check to the drawer's bank for certification. Although the bank is obligated to cash the check, it need not certify the check because only it, not the drawer or any subsequent endorsers, would be liable for its payment. Some banks will certify a check in such instances only with the approval of the drawer.

If a bank refuses to pay a check that it has certified, its drawer or holder may sue the bank for its wrongful conduct, called dishonor. A certified check, a type of Commercial Paper or negotiable instrument, is governed by Article 3 of the Uniform Commercial Code.

certified check

n. a check issued by a bank which certifies that the maker of the check has enough money in his/her account to cover the amount to be paid. The bank sets aside the funds so that the check will remain good even if other checks are written on the particular account. Like a cashier's check, a certified check guarantees that it is immediately good since it is guaranteed by the bank and the recipient does not have to wait until it "clears." (See: cashier's check)

References in periodicals archive ?
It is a little bit of a surprise for us because my signature on our cashier's checks is only recent, so I've only had my signature on there since the end of October.
Lauderdale firm recently reported it received a $600,000 cashier's check, "from Canada, of course," for a yacht sale transaction, as did another maritime attorney in the same area.
The indictment alleges he was allowed to resign in February 2012 and paid back the amount he had stolen with two cashier's checks from another bank.
51) Similar techniques allow a fraudster to duplicate cashier's checks, placing a replica of an official bank officer's authorizing signature onto what would otherwise appear to be a perfectly valid commercial article.
Companies automatically think cashier's checks must be authentic," he said.
Ultimately Caprario received what appeared to be a cashier's check drawn on a Wyoming bank for $5,500 for the entire purchase.
Counterfeit cashier's checks have dogged banks in Arkansas and elsewhere recently.
Stockbroker's or cashier's checks should be used since they are completed gifts when issued.
Payment by cashier's check or money order only; allow four to six weeks for delivery.
The counterfeit items display the routing number 082901596, which is assigned to the First State Bank of Warren, and are similar to authentic cashier's checks.
Saban, 43, pleaded guilty in October 2002 to the charge of conspiracy to launder money for his role in a counterfeit cashier's check cashing scheme.