Check Handling and Prohibited Practices

What this video covers

• The three exact parties to a negotiable check: the drawer who writes it, the drawee bank that pays it, and the payee who receives it, plus the memory aid that keeps drawee and payee straight on test day
• What controlled check issuance requires and why the workflow moves from authorized issuance to check blotter record to tracking and reconciliation
• The two control functions a check blotter serves, and why the exam traps you by calling it merely a record of checks awaiting payment
• What check kiting is, how it exploits timing differences between financial institutions, and why it creates apparent funds rather than actual funds
• Why altering a check after issuance without authorization is prohibited, and what counts as an extended check hold versus a neutral processing delay
• The mandatory two-way rule for account transfers: both members must expedite and coordinate authorized account asset transfers, and why a hold by either side is a violation