Consumer Banking and Payments Law: 4.5.9.2 Doubtful Collectability
A second exception is for checks if the bank has “reasonable cause to doubt collectability.”271 Under certain circumstances, a bank may reasonably believe that the chances are great that the checks a consumer deposits will be dishonored.272 The bank does not want to allow early withdrawals of those funds by the consumer and then have to try to collect the amount of the withdrawal from the consumer.
