Legal Question in Banking Law in Tennessee

Counterfeit Postal Money Orders

Where a customer tells a bank teller: (1) I did not want to deposit three postal money orders to my account, (2) I did not want them linked or tied to my checking account in any way, and (3) I simply wanted to cash the money orders, does a bank have a right to charge my account if they turn out to be counterfeit? The teller told me to endorse the money orders in a peculiar manner: to write ''Not for Intended Purpose'' on back, which I thought meant they would not be tied to my account. I subsequently learned that TN has a statute that provides for an endorser to write ''Without Recourse'' on a negotiable instrument, but the teller failed to give me the correct endorsement for my cirucmstances. The teller failed to inspect the money orders or hold them up to the light to check for a watermark. The U.S. Postal Inspectors office in Knoxville had been in direct contact with the security officer at Suntrust Bank about counterfeit postal money orders, but Suntrust failed to give its tellers proper training and alerts to protect its customers.

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