In October of 2003, the Check Clearing for the 21st Century Act (Check 21) was passed into law and is
effective October 28, 2004. The goal of this act is "to improve the overall efficiency of the nation's
payment system." Since today's check processing environment involves extensive transportation costs and
is time consuming, this law allows for the creation of a new negotiable instrument called a "substitute
check" which will expedite the check collection process.
What is a Substitute Check?
To make check processing faster, federal law permits financial institutions to replace original checks with
"substitute checks." These checks are similar in size to original checks with a slightly reduced image of
the front and back of the original check. The front of a substitute check states: "This is a legal copy of
your check. You can use it the same way you would use the original check." You may use a substitute check
as proof of payment just like the original check. Some or all of the checks that you receive back from us
may be substitute checks or copies of substitute checks. This notice describes rights you have when you
receive substitute checks from us. The rights in this notice do not apply to original checks or to electronic
debits to your account. However, you have rights under other laws with respect to those transactions.
What are my Rights Regarding Substitute Checks?
In certain cases, federal law provides a special procedure that allows you to request a refund for losses you
suffer if a substitute check is posted to your account (for example, if you think that we withdrew the wrong
amount from your account or that we withdrew money from your account more than once for the same check). The
losses you may attempt to recover under this procedure may include the amount that was withdrawn from your
account and fees that were charged as a result of the withdrawal (for example, insufficient funds fees). The
amount of your refund under this procedure is limited to the amount of your loss or the amount of the substitute
check, whichever is less. You also are entitled to interest on the amount of your refund if your account is an
interest-bearing account. If your loss exceeds the amount of the substitute check, you may be able to recover
additional amounts under other laws. If you use this procedure, you may receive up to $2,500 of your refund
(plus interest, if your account earns interest) within 10 business days after we received your claim and the
remainder of your refund (plus interest, if your account earns interest) not later than 45 calendar days after
we received your claim. We may reverse the refund including any interest on the refund, if we later are able to
demonstrate that the substitute check was correctly posted to your account.
How do I Make a Claim for a Refund?
If you believe that you have suffered a loss relating to a substitute check that you received and/or that was posted
to your account, please call your local branch or the Call Center at 1-888-732-8562 or send a secure message from our
website. You must file your claim with us within 60 calendar days of the date that we mailed (or otherwise delivered
by a means to which you agreed) the substitute check in question or the account statement showing that the substitute
check was posted to your account, whichever is later. We may extend this time period if you were not able to make a
timely claim because of extraordinary circumstances.
Your claim must include:
A description of why you have suffered a loss (for example, you think the amount withdrawn was incorrect);
An estimate of the amount of your loss;
An explanation of why the substitute check you received is insufficient to confirm that you suffered a loss; and
A copy of the substitute check and/or the following information to help us identify the substitute check: the check number,
the name of the person to whom you wrote the check, the amount of the check
