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Blank Endorsement: Definition & Example

Instructor: Rana Abourizk

Rana has a Masters Degree in Business Administration and is pursuing a Doctorial Degree. She has been teaching online for over a year. She has a strong business background.

Bankers are very familiar with endorsements. They see different types of endorsements every day. They are trained to check the endorsements so that they know how to handle the transaction and make sure it's accurate. Today we will discover what blank endorsement is.

What Is a Blank Endorsement?

Every check needs to be properly signed before someone can cash or deposit it. A signature can be handwritten or typed. A blank endorsement is when someone signs the back of a check that does not indicate a particular payee. The person who wrote the check is considered the remitter. Once endorsed, the check can be cashed by anyone who wishes to claim it. People can also write a check to themselves as cash, and cash it. They just sign the back.

There aren't any constraints of condition or time on blank endorsements. A constraint of condition can be something like the maker of the check typing the name of the person specifically and the date on the back of the check where the area for a signature is located. For example, including 'Sam Smith, June 12th, 2015' on the back of the check would prevent it from being a blank endorsement.

There is one line on the back of the check, and above the line it says, 'endorse check here.' It doesn't read 'for deposit only' or 'to be payable to so and so.' It is simply blank. There are no additional constraints. However, since the back of the check is left blank for a signature, if the payees endorse it, leave it around the house, the maid picks it up and signs it over to herself, then that's an issue. The maid could take the check and deposit it into his or her account. Folks need to be careful with blank endorsements. It's always a good idea to play safe and only sign the check right before cashing or depositing.

Examples

Example #1: A couple walks into the bank with a check. They want to put the check into a shared account. The man and wife simply sign their names on the back of the check simply and present it to the teller. They just want to deposit the check. They could cash it if they liked since they are both present and can be verified. If they just want to deposit it, the teller can just verify the account the check will be deposited into, the check itself to ensure proper endorsement and things like the date, memo, clarity of the check and the condition.

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