- Is taking
checks by fax legal?
- What else do I
need?
- Can I use a
bubble jet printer?
- The
MICR fonts aren't working, how come?
- What do banks
think?
- Can companies out side of the U.S. use this program?
- What if my customer has concerns about giving out their check
information?
1. Is
taking checks by fax legal? Check
demand drafts, or drafting funds from a second party's checking account, have
been a method of payment for more than 8 years, usually in collections.
Telephone checks (pre-authorized paper bank drafts) are completely legal. The
primary requirement is that the checking account holder (your customer) must
give you verbal or written pre-authorization, such as faxing you their check.
Once you've received pre-authorization, you really don't even need a signature
on the paper-draft, just as you don't need a signature on a phoned in credit
card order. Paper drafts are explicitly established as a legal method for
payment as provided in: Uniform Commercial Code, Title 1, Section 1-201 [39] and
Title 3, Sections 3-104, 3-403, 2-403 Code of Federal Regulations, Title 12
Chapter II, Part 210 Regulation J, Federal Reserve Bank, Part 2, Sections 4a-201
to 4a-212 Also see Romani v. Harris, 255 Md. 389. The Federal Trade
Commission in late 1995 proposed rules that became law in January 1996
(Regulation 16CFR Part 310) that requires businesses who take checks over the
phone to have a verification procedure in place. This could include receiving
written authorization by mail or fax, recording the authorization phone call
with customers permission, and/or sending out written notice to customer prior
to depositing paper draft. This notice only needs to be in the mail prior to
making deposit. The 3 part check paper you use with Checks by Fax Platinum Pro
7.06
provides this important notice that fits into a standard #9 or #10 window
envelope. Or you can just include it with the product you ship provided you
don't deposit the paper draft prior to actual shipping. Both you and your
customer are now protected by requiring ALL users of such a payment system to
have a verification of authorization procedure.
2. What else do I need to
accept and print checks by fax? All you need in
addition to this software is blank check paper (Safety Paper)Appx $65.00 for
2,000 sheets. For most laser printers, no special toner is required. The magnetic content of the toner in most laser printers is
sufficient. (In rare cases, a special MICR
toner is required.) This is available from your toner supplier.
3. Can I use a
bubble jet printer? Many users use
Bubble Jet Printers or Ink Jet Printers to print checks with no problems. Most
banks have gone to optical scanning which requires no special toner. Our company
uses a Cannon Bubble Jet Printer and our business banking is done with Wells
Fargo, and we have never had any problems processing the drafts created with
this software. There are many areas that are still requiring magnetic scanning, and this is where the problem lies. The best
thing to do is call your bank and ask if they use optical scanning.
4. The
MICR fonts aren't working, how come? If you experience
problems with your MICR Fonts: Missing Fonts or when printing checks the
letter C an A are printed instead of the MICR Font: 1. If you are using a
laser printer be sure your configuration is set to print True Type Fonts
Graphically. 2. Re-install fonts: Verify that you have three MICR fonts
located in C:\windows\fonts. If the files are present; copy fonts to a different
directory then delete files located in C:\windows\fonts. Next click-on
settings/then: control panel/then: fonts/ then: file/ select install new
fonts(select directory were you copied MICR fonts)/then: select install all (3
MICR Fonts.) 3. If fonts are not located install from original download zip
file. Follow procedure #2 above. 4. You can also try just deleting the
program and re-install. Note: About 10% of Computers experience this problem due
to bug in Windows 95 registry, we have been working with Microsoft to correct
this problem. We here at Quick Pay apologize for any inconvenience.
5. What do banks
think? Since paper drafts are perfectly legal your bank must accept
your deposit. The only problem that may arise is if you are not using the
magnetic toner with a laser printer. The best way to find out is print out a
check to yourself on the proper security check paper needed and deposit it. Sit
back and watch it go through! You actually don't even need to use security
paper, but the banks do get a little more fussy about that kind of
thing.
6. Can companies out side of the U.S. use this
program? At the present time most countries do not have banking
guidelines in place for the processing of bankdrafts. We recommend using this
program for processing checks for banks in the USA, Canada and possessions only.
7.What if my customer has concerns about giving out their check
information? Explain that you
would have the same information if they mailed you a check. Taking checks
electronically is really no different than accepting a credit card over the
phone. No signature is required for a phone in credit card order, the customer
knows he will only be charged for what he has ordered or the business that takes
the order would be breaking the law. The same theory applies to bankdrafts, the
business can only legally create a draft for the amount that has been authorized
by the customer. As more and more people find out about checks by phone, fax or
online order and use it the more it will be accepted. Once the public gets over
the uniqueness of the product, they will find it really makes a whole lot of
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