Check 21 Introduces Changes to Check Processing

The Check Clearing for the 21st Century Act (Check 21) was enacted by Congress to reduce the time and expense associated with processing and transporting the billions of checks that Americans write each year, and as a means of fighting check fraud.

Effective October 28, 2004, financial institutions have the option to create a digital image of the original check, which is then transported through the payment system electronically, along with other information pertaining to the check. The original paper check may be destroyed. When the electronic image is converted back to paper, it is known as a "substitute check."

• A substitute check must be accepted as proof of purchase or payment by merchants, governments and other payees, just as if it were the original check.
• No individual, business or financial institution may "opt out" of Check 21.

What Does A Substitute Check Look Like?

The images below show the front and back of a sample substitute check. Slightly larger than a normal consumer check, the substitute check contains a reduced version of the original check, other documentation to identify the transaction, and the words, "This is a LEGAL COPY of your check. You can use it in the same way you would the original check."

Source: ASCX9, Inc.

Not all paper checks will be converted to substitute checks, and United Bank has no immediate plans to create substitute checks. However, we may receive them from other financial institutions.

If you receive your canceled checks with your statement, you may receive a combination of original checks and substitute checks. If your checks are not returned to you with your statement, you may receive a substitute check when you:

• Request a copy of a paid check from United Bank
• Receive a check you deposited that is returned unpaid

What Changes Can You Expect?

Check 21 won't change the way you write checks, or receive them from others. However, you may notice that checks clear faster - sometimes in a day or even less. This is one element in the government's plans to reduce check fraud, by identifying fraudulent items more quickly. But faster check clearing also means less "float," so it is important that you have the funds in your account to cover the checks you write to avoid overdrafts.

Please refer to the accompanying notice on your rights regarding substitute checks, and keep it with your files for future reference. If you have any additional questions, visit your nearest United Bank office or call us at the following number:

    West Virginia and Ohio - 1-800-327-9862

Your Rights Regarding Substitute Checks

Some or all of the checks that you receive back from us may be 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 law with respect to those transactions.

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, bounced check 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 law.

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 To Make A Claim For A Refund

If you believe that you have suffered a loss relating to a substitute check that you received and that was posted to your account, please contact us as follows.