( Originally Published 1918 )
How Indorsement Should Be Written. Write the indorsement across the back (not lengthwise) of the check.
Each Successive Indorsement should be written under those that precede it.
In Depositing a Check, write across the back "For Deposit," and below this your name. Checks thus indorsed can only be deposited, and should they be lost on the way to the bank the finder cannot use them.
Merely Writing Your Name on the Back is a blank indorsement, and signifies that it has passed through your hands and is payable to bearer, anyone into whose hands it may come.
To Make Check Payable to Some Particular Person, write: Pay to the order of (persons name), and sign your name.
Do Not Send Away a Check Indorsed in Blank, but make it payable to the person to whom you send it. Then if lost it cannot be paid to anyone else.
A Person Must Indorse His Name as It Is Written in the check. A check drawn payable to W. King, cannot be indorsed Wm. King. If drawn payable to Rev. W. King, it should be so indorsed, as bankers are very particular to have the name of the payee as given on the face of the note exactly reproduced in the indorsement.
If the Spelling of the Name on the Face Is Wrong, indorse it in that way and then write it underneath correctly.
Responsibility of Indorsers. The following table shows the relative responsibility of each indorser. Each indorser is responsible to the one below him.
Checking WithoutFunds. In several localities issuing a check that is not covered by funds actually in bank is a punishable offense, not mitigable by a plea of oversight or negligence. A man is supposed to know what his balance is, and to keep within it.
A Check Is a Receipt. The payee of a check must write his name on the back of it before depositing. This endorsement converts the check into a receipt. The United States Supreme Court settled that fact by this decision:
"The maker of a check is obliged to use all due diligence in protecting it. The omission to use the most effectual protection against alteration is evidence of neglect, which renders him responsible for the fraudulent amount, the Bank being responsible only for the genuineness of the signature and ordinary care in paying the check.
"If by any act or negligence on the part of the drawer as by so carelessly writing the check as to render it easily open as to material alterations without leaving evident traces of destruction, the customer has furnished the principle for the fraud, which has deceived the Bank, he must therefore suffer the just consequences of his carelessness by bearing the loss himself."
1. Make your deposits in the bank as early in the day as possible, and never without your bank book.
2. Always use the deposit ticket furnished by the bank. When checks are deposited, the banks require them to be indorsed, whether drawn to the order of depositor or not.
3. Do not allow your account to run too long without balancing. Compare it with the account of the bank. Have your bank book written up by the bank, or ask for a statement with canceled checks attached.
4. Write your signature with the usual freedom and never vary the style of it.
5. Draw as few checks as possible; when several bills are to be paid, draw the money in one check.
6. Always keep your check book under lock and key.
7. In filling up checks do not leave space in which the amount may be raised. Always fill the space with a dash. Use words instead of figures.
8. If one who holds a check, as payee or otherwise, transfers it to another, he has a right to insist that the check be presented that day or at farthest, on the day following.
9. If you wish to draw money from the bank on your own check write: "Pay to myself," "Pay cash" or "Pay currency" instead of writing your name in the body of the check.
10. If you write a check to a person who will have to be identified at the bank in order to receive payment, have him indorse the check and then beneath his signature write "Signature O. K.," and sign your name. This will enable him to draw payment on the check without further identification.