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Does electronic check conversion financial institution to make sure the amounts Where can I file a complaint

allow me to use the same check charged are correct. about a merchant or someone
more than once? else I paid by electronic check The Federal Reserve Board
No. An electronic check conversion transac- What if I don’t want my check conversion?
tion is a one-time electronic payment from to be used for electronic check
Contact:
your account. If you were to use the same conversion? Federal Trade Commission
check for more than one transaction and you If you don’t want your check to be used for Consumer Response Center
600 Pennsylvania Ave., NW

When Is
had a problem with one of the transactions, electronic check conversion, you may have to Washington, DC 20580
your financial institution might have difficulty provide another form of payment (for exam- 877-FTC-HELP or 877-382-4357 (toll free)
investigating the problem because the same
check number would appear more than once
ple, cash, debit card, or credit card). Under
federal law, billers (such as a utility or credit
www.ftc.gov
Your Check
Not a Check?
Please also send a copy of your complaint to:
on your statement. card company) are not required to provide
Board of Governors of the Federal Reserve System
you with an opportunity to opt out of elec- Division of Consumer and Community Affairs
Can electronic check conversion tronic check conversion. However, you may Washington, DC 20551
occur if I mail a check to pay a try to contact billers directly at the address 202-452-3693
bill? they provide and ask them not to convert your www.federalreserve.gov John Doe 1234
111 Oak Drive

check.
Hometown, ST 00000

Yes. For example, let’s assume that each


Remember . . . PAY TO THE
ORDER OF $

time you get your insurance bill, it includes DOLLARS

Before you agree to electronic check conver- Hometown Bank

a notice. The notice tells you that if you What if I need a record of my MEMO

sion, you should first ask yourself


check as proof of a payment I
1234566789 7890 1234 0000
mail a check, you authorize your insurance
company to use information from that check
 Do I understand that the information
made? from my check will be used to make an
to make an electronic payment from your
Your checking account statement will contain electronic payment from my account?
account. If you then send a check, you have
information about your payment, including  Do I have enough money in my account
agreed to electronic check conversion. Unlike
what happens when you make a purchase at
the date, the check number, the name of the
person or company you have paid, and the
to cover the payment?
Before you leave the store, you should ask
Electronic
a store, however, you won’t receive a receipt.
Your check won’t be returned to you with your
amount of the payment. The statement is yourself
 Did I receive a receipt?
Check
Conversion
generally accepted as proof of payment.
account statement from your financial institu-
 Does the amount on the receipt match
tion because the transaction was processed
the amount of my purchase?
as an electronic fund transfer, not as a check What if I have a question or
problem with an electronic check When you receive your statement from your
transaction.
financial institution, you should
For bill payments, you should take the same conversion?
 Make sure that the charges on your
precautions as you do with electronic check Contact your financial institution. For informa- statement match your records.
conversions in stores. Be sure you have tion on state laws that may apply to elec-  Contact your financial institution right
enough money in your account when you mail tronic check conversion, contact your state’s away if you notice a problem.
your check, keep records of your payments, consumer protection agency or attorney
and check your account statements from your general’s office. FRB-1-307
What is electronic check will be given a copy of the posted notice (or have enough money in your account to
conversion? a similar notice) that you can keep for your cover the transaction, your check may
records. This notice usually appears on your be returned to the merchant for nonsuf-
Electronic check conversion is a process in
sales receipt. ficient funds (NSF), and the merchant may
which your check is used as a source of infor-
Suppose mation—for the check number, your account
charge you a fee. This fee is similar to a
bounced-check fee.

RS
you’re at a What are some of the differences

DOLLA
1234
number, and the number that identifies your

$
store making between electronic check  You have the right to receive a receipt

0000
financial institution. The information is then

1234
used to make a one-time electronic pay- conversion and using my check when you make a purchase at a store. The
a purchase and
7890
receipt will contain information about the

89
nk
as payment?
n Ba

5667
JohnOak Drive 00000

ment from your account—an electronic fund


decide to pay etow
111 town, ST

1234
Hom transaction, including the
Doe

MEMO
Home

transfer. The check itself is not the method of  Your electronic transaction may be pro-
by check—  Date
00
00
34
12
90

payment.
78
89
67

cessed faster than a check. Be sure you


56

 Amount
34
12

at least, that’s have enough money in your account at the  Location


what you believe time you make a purchase.  Name of the merchant
How will I know that my check  You have the right to have this same
you’re doing. But is being used for electronic check  Your financial institution will not return any
transaction information included as part of
then the clerk runs conversion? checks that are converted, even if you
the regular account statement from your
your check through a normally receive your original checks or
When you provide your check, you must be financial institution.
images of those checks with your state-
machine and hands the voided check given notice that information from your check  You have the right to ask your financial
ment.
back to you with your receipt. Later, may be used to make an electronic payment institution to investigate any electronic
from your account. The notice is required by  You have different consumer rights in an
when you get your bank statement, fund transfers from your account that you
the federal law that applies to electronic fund electronic check conversion transaction
believe are unauthorized or incorrect.
that check isn’t listed with your other than you do when you use your check as
transfers, the Electronic Fund Transfer Act,
check transactions. Instead, you payment. For example, in an electronic
and by the Federal Reserve Board’s Regula- What should I do if I have a
notice an electronic debit to the store tion E. check conversion, you have the right to an
investigation by your financial institution
problem with an electronic check
for the amount of the transaction. You may receive notice in different ways. conversion transaction?
when an error occurs.
For example, a utility or credit card company
What happened? Did you pay by Always review your regular account statement
might put a notice in your bill stating that if
from your financial institution. You should
check or not? Why did the clerk return you pay by check, your check may be used What are my rights in electronic
immediately contact your financial institu-
the check to you? The answer is, you to make an electronic fund transfer from your check conversion transactions?
tion if you see a problem. Were you charged
just experienced electronic check account.  You have the right to receive notice that if the wrong amount? Were you charged twice
If you pay with a check at a store or other you provide a check as payment, informa-
conversion. for the same transaction? You have only 60
place of business, you will receive notice in tion from the check may be used to make
days (from the date your statement was sent)
two different ways. First, a merchant must an electronic payment from your account. to tell the financial institution about a prob-
post a sign–typically at the register–notifying  When you provide your check, you have lem. Depending on the circumstances, the
you that if you pay by check, you are agree- the right to receive notice of any fee that financial institution may take up to 45 days
ing to let the merchant make an electronic the merchant will collect from your account from the time you notify it to complete its
fund transfer from your account. Second, you electronically. For example, if you do not investigation.