2006-09-29 05:32:10 · 6 answers · asked by pallavibalraj_2001 1 in Business & Finance ➔ Small Business
to ensure that the person given the check is forced to deposit it into their own account.
If you didn't, the person could sign it over to someone else who could then use it to do bad/illegal things (like check-kiting) and you may get a call from a bank or law enforcement about your involvement with it.
It's a way to safeguard that the money you spent with someone you know is paid only to them. From there, how it's spent is no concern of yours.
Also if you paid someone by check and you're not sure that they're truthful about their identity then this ensures that they must have a bank account in that name in order to cash your check (the bank takes care of verifying identity for you).
If you have an ex living with your child and you want to be sure that only one of them has access to the money make it out to that person and "cross" the check so that it must be deposited into the account of the payee only.
2006-09-29 06:35:31 · answer #1 · answered by xamayca.com 4 · 0⤊ 0⤋
To ensure that the cheque is encashed only through a bank account thus leaving a trail. Why do you need this trail ? The cheques are normally issued to clear an obligation such as wages. loans, business dues etc. The trail will help you to trace the payments, in case of any dispute.
2006-09-30 00:04:22 · answer #2 · answered by cvrk3 4 · 0⤊ 0⤋
So it cannot be cashed or endorsed (signed over) to another bank account. It has to be deposited in the account of the person it is made out to and cash can only be drawn on it when the cheque has cleared.
2006-09-29 12:37:20 · answer #3 · answered by Anonymous · 0⤊ 0⤋
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2006-09-30 08:10:11 · answer #4 · answered by ravi_tyger 1 · 0⤊ 0⤋
To avoid misutilisation.
2006-09-29 14:08:15 · answer #5 · answered by ar.samy 6 · 0⤊ 0⤋
TO MAKE SURE THAT PAYMENT GOES TO THE PERSON'S ACCOUNT WHOSE NAME APPEAR ON THE CHEQUE
2006-09-30 23:14:47 · answer #6 · answered by tan_kaa_milan 3 · 0⤊ 0⤋