US Check Cashing
US Checks circulate around the world. Whether they are personal checks, company checks, money orders and traveler checks, checks drawn against US Banks are sent, taken, and written in many countries around the world. Years ago, these checks were received by banks for a deposit or cashed by foreign exchange firms but they had to be sent by mail or courier services back to the US for deposit.
Sometime in the 90s and the early years of this century, US customs started stopping the envelopes containing the checks sent for deposit, even if they were fulfilling all the required documents and reports. This concerted effort of the US regulators to stop these checks in fear of being the source of money laundering and other suspicious activities and even if they were later released after legal recourses were used by the institutions involved, being time-sensitive materials. After loses and hardships, the deposit & cashing of US checks became a service that few institutions decided to continue offering.
On the other hand, very few banks were accepting third-party checks for deposits, worried about the US regulator’s view of these checks as being high risk.
But times have changed. Fintechs developed remote-capture systems for digitizing the paper checks, and regulators came up with new laws and requirements for AML controls that came into place, not after several institutions were fined for lack of good controls.