Wells Fargo / cashier's check - security bond
I sold my car to a private party and received a cashier's check for $13, 000 drawn on a Wells Fargo account. Before the check could be deposited (within 2 hours) it was lost. I immediately notified the buyer (who has the account at Wells Fargo) and he immediately notified Wells Fargo (within 4 hours) The two of us went to Wells Fargo to discuss the situation with the bank manager. This is where my saga begins.
We were told that the buyer (I'll call him Joe) could purchase a security bond at Wells Fargo (WF) for 2% of the check value ($262) and WF would immediately reissue the check. "The Hartford" is the institution issuing the security bond. Joe needed to acquire the security bond since he had the account at WF. I paid $262 to Joe (after all, it was my fault) and he filled out paperwork and purchased the bond.
Several days passed. No word from anyone. I asked Joe about the status. Joe became alarmed when he studied the fine print from the Hartford regarding the bond. He freaked out when he interpreted the verbiage to say the HE was liable for the $13, 000 if the lost check was cashed. This is not what we were told by WF.
Joe and I went to another WF branch (where I have more confidence) and asked the questions. The personal banking representaive was helpful, knowledgeable and very attentive...even though this wasn't 'his' problem. Although he was careful not to step on toes of the first WF bank, the loan officer had the personal opinion that the check should have been reissued by now and that the security bond protected Joe in cash the lost check was cashed. He checked and discovered that the $13, 000 check had NOT been reissued and the the $262 payment for the security bond had NOT been cashed. We had received no information from the originating WF branch. Joe was not satisfied and kept pushing and asking to see written documents that explained liability in cash the lost check was cashed. The 'good' WF branch also determined that a 'do not pay' order had been issued for the lost check.
At the bottom of the paperwork was a contact phone number for the Hartford and I called them. (what a novel idea :-) )O ONE at WF had contacted the Hartford for clarification or for information on paperwork required, review and approval criteria or how the process worked.
These are the FACTS that I discovered -- and are contradictory to the information we were given by WF. Via the Hartford's phone number, there was a recorded message with an detailed description of the steps that needed to be followed. Apparently WF was unaware.
1) The security bond protects WF, not Joe. 2) The security bond enables WF to cut another check quickly, thats ALL IT DOES. However if the first, lost check, is found and cashed, Joe is liable for reimbursing WF The $262 payment allows the new check to be issued-- nothing more. 3) the Paperwork to request the security bond should have included Joe's financial statement (it did not). The Hartford requires Joe to have 2x the value of the security bond in his account for them to 'authorize' the bond. He does not so the Hartford would have never approved the security bond. 4) the paperwork should have been faxed to the Hartford for an immediate decision -- THEN, if approved, we would pay the $262.00. (it was sent hardcopy mail). 4) The Hartford's representative called me and explained the process. (Thank you) Apparently Joe is liable to WF for the 'lost check' for a specified period of time -- one person said 90 days another said 6 months. (I need to get accurate information on this.) ANYONE can purchase the security bond -- not only the person with the account at WF or the person who initiated the first check...and a number of institutions offer them. The only true requirement is that WF accept it.
So, after two weeks and a lot of frustration, I am back at square one and have absolutely no confidence in any information from WF. I have the choice of spending $262 to get a check reissued, but Joe is liable for the $13000 for a period of time. WF has issued a 'do not pay' notice for the lost check -- but they guarantee nothing. Apparently they don't believe in their own processes.
SO, the bottom line is this -- sweet and simple. If you lose a cashier's check you can consider the money lost until some unknown time-frame passes. Even though a 'do not pay' notice is issued by the bank, even though you purchase a security bond, and even though you can get a new check issues within a few days/weeks. ...you cannot be sure that the lost check is truly dead for a long time.
Now I need to find out what is needed to cause the check to be reissued after the unknown time period passes. Please pray for me in getting accurate information from Wells Fargo.
And, yes, I've learned my lesson about being careless. And, yes, I am thankful that it is possible that I might be able to recover the money.
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