What is a 'Crossed Check'

A crossed check is any check that is crossed with two parallel lines, either across the whole check or through the top left-hand corner of the check. This symbol means that the check can only be deposited directly into a bank account and cannot be immediately cashed by a bank or any other credit institution.

BREAKING DOWN 'Crossed Check'

By using crossed checks, check writers can simply but effectively protect the checks they write. Crossed checks are predominantly used in countries across Europe and Asia, as well as in Mexico and Australia. Crossed checks are rarely used in the United States; any individual attempting to deposit a crossed check in the U.S. may encounter problems.

Crossing a check provides specific instructions to a financial institution regarding how the funds can be handled. Most commonly, it is used to ensure a bank only deposits the funds into an actual bank account and does not immediately cash it upon initial receipt. This provides a level of security to the payer, as it requires the funds be handled through a collecting banker.

Marking a Crossed Check

While the precise formatting and wording may vary between nations, the most common symbolic market involves two parallel lines being drawn. These lines may be located across the center of the check or noted in the top left corner, and may or may not also contain the words "& Co." or "not negotiable," noting the change in status. Otherwise, the phrase "Account Payee" may also be written on the check, and performs the same function as crossing it.

Uncrossing a Check

If a check is crossed, there is no way for the payee to uncross the check. Additionally, the check is considered non-transferable; it cannot be transferred to a third party. The only action permitted is for the payee to deposit the check in an account that he holds in his own name.

The payer can uncross the check by writing "Crossing Canceled" across the front of the check. However, this is generally not recommended; it eliminates the protection the payer originally had in place.

Failure to Comply

Should a receiving bank fail to comply with the crossing, it can be deemed as a breach of contract between the institution and customer who wrote the check. If the payee did not truly have the funds available to cover cashing the check, the bank may be responsible for any associated losses.

Open Checks

An open check, also referred to as a bearer check, is any check that is not crossed. Open checks may be cashed at the counter, with the funds being provided directly to the payee.

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