§5003 — Title 12 Banks and Banking | U.S. Code

Summary

Allows anyone to deposit, present, or send a substitute check without a special agreement, if a bank has made the warranties required in section 5004. A substitute check counts as the same as the original check if it correctly shows all the front and back information that was on the original when it was truncated, and if it includes a clear statement telling the holder it is a legal copy that can be used the same way as the original. The bank that recreates the paper check must put on all endorsements that earlier handlers applied. It must also identify itself as the reconverting bank and keep earlier reconverting bank IDs according to normal industry standards. A valid substitute check is treated like the original under part 229 of title 12 of the Code of Federal Regulations, the Uniform Commercial Code, and other federal or state laws, unless those laws conflict with this chapter.

Title 12, §5003

Banks and Banking — Source: USLM XML via OLRC

(a)A person may deposit, present, or send for collection or return a substitute check without an agreement with the recipient, so long as a bank has made the warranties in section 5004 of this title with respect to such substitute check.

(b)A substitute check shall be the legal equivalent of the original check for all purposes, including any provision of any Federal or State law, and for all persons if the substitute check—

(1)accurately represents all of the information on the front and back of the original check as of the time the original check was truncated; and

(2)bears the legend: “This is a legal copy of your check. You can use it the same way you would use the original check.”

(c)A bank shall ensure that the substitute check for which the bank is the reconverting bank bears all endorsements applied by parties that previously handled the check (whether in electronic form or in the form of the original paper check or a substitute check) for forward collection or return.

(d)A bank shall identify itself as a reconverting bank on any substitute check for which the bank is a reconverting bank so as to preserve any previous reconverting bank identifications in conformance with generally applicable industry standards.

(e)A substitute check that is the legal equivalent of the original check under subsection (b) shall be subject to any provision, including any provision relating to the protection of customers, of part 229 of title 12 of the Code of Federal Regulations, the Uniform Commercial Code, and any other applicable Federal or State law as if such substitute check were the original check, to the extent such provision of law is not inconsistent with this chapter.

Notes & Related Subsidiaries

Editorial Notes

References in Text

This chapter, referred to in subsec. (e), was in the original “this Act”, meaning Pub. L. 108–100, Oct. 28, 2003, 117 Stat. 1177, which is classified generally to this chapter. For complete classification of this Act to the Code, see

Short Title

note set out under section 5001 of this title and Tables.

Statutory Notes and Related Subsidiaries

Effective Date

Section effective at the end of the 12-month period beginning on Oct. 28, 2003, see section 20 of Pub. L. 108–100, set out as a note under section 5001 of this title.

§5003 General Provisions Governing Substitute Checks