Content area
Full text
QA Recently, there has been a flurry of attention around Check 21, the new banking law that took effect on October 28, 2004. Known formally as the Check Clearing for the 21st Century Act, this federal law was designed to make the nations check processing system faster and more efficient. By authorizing a new instrument called a substitute check, Check 21 enables electronic check exchange. Rather than the costly and inefficient process of physically transporting paper checks from one bank to another, banks can now capture a picture of a check and send it electronically.
The following quick reference guide answers commonly asked questions about how this new law affects consumers. For more information, please visit the Federal Reserve Bank of Bostons Check 21 website: www.bos.frb. org/consumer/check21 or call the Boston Fed's consumer hotline at (617) 973-3755.
Q. What is a substitute check?
A. A substitute check is a paper copy of the front and back of an original check. Under Check 21, this copy has the same legal status as the original check, as long as it accurately represents all of the information on the front and back of the original check and includes the following statement:
This is a legal copy of your check. You can use it the same way you would use the original check.
Consumers who were previously receiving cancelled checks with their statements may now receive a mixture of canceled original and substitute checks. Similarly, consumers who received image statements containing pictures of original checks may now receive some images of...