Deposit Operations Flashcards

A customer presents a check made payable to 'John or Jane Smith.' Who may endorse and deposit this check?

Answer: Either John or Jane Smith alone

When a check uses 'or' between payees, either party may independently endorse and deposit the check.

What is a 'stale-dated' check?

Answer: A check written more than 6 months ago

A stale-dated check is generally one more than 6 months (180 days) old, and banks are not obligated to honor it.

Which FDIC insurance category covers an individual's single-ownership accounts at the same bank?

Answer: Single account ownership

All single-ownership accounts held by one person at the same bank are aggregated under the single account ownership category, insured up to $250,000.

A customer wants to open a money market deposit account (MMDA). Which feature distinguishes it from a regular savings account?

Answer: It may require a higher minimum balance and allows limited check-writing

MMDAs typically require higher minimum balances than regular savings accounts and allow a limited number of checks or transfers per cycle.

What is the purpose of a signature card in deposit operations?

Answer: To authorize individuals who may transact on the account

A signature card is a legal document that identifies authorized signers and governs who may conduct transactions on the account.

Under Regulation D, how many convenient withdrawals or transfers were traditionally allowed per month from a savings account?

Answer: 6

Regulation D historically capped savings account transfers at 6 per month, though the Fed suspended this limit in 2020; many banks still enforce it.

A customer receives a cashier's check from a stranger and asks to deposit it and wire the difference after a 'partial refund.' What is this likely?

Answer: An overpayment scam

Overpayment scams involve fraudulent checks; the customer wires real money before the fake check bounces, resulting in a loss.