Legal Question in Banking Law in Illinois

My wife sent a check to Carson's in payment on her account there. Unbeknownst to my wife, another check made out in payment to our health insurance co. was stuck to the paperwork sent to Carson's. Carson's cashed both checks and was paid electronically. Carson's took the money made out to the insurance company and put it as credit on our Carson's account. Evidently, the bank does not need to receive the written check in order for Carson's to receive payment - they said the transaction was done electronically and the check was destroyed by Carson's. I do not understand. I was always under the impression that it was illegal to cash a personal check that was not made out to you. Not only was payment made to Carson's by our bank, the illegally cashed check was destroyed by Carson's without our bank ever seeing it. What am I missing here?


Asked on 11/25/14, 1:08 pm

1 Answer from Attorneys
Lawrence A. Stein Aronberg Goldgehn Davis & Garmisa, LLC

Call Carsons. They should reverse the transaction. If that doesn't work, call your bank. Carson's endorsement is not sufficient to permit the application of the insurance check to the Carson's account, and your bank should be able to reverse the transaction.

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Answered on 11/25/14, 1:32 pm


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