Weird Check Payment Question...

I was wondering if anyone know how it was possible to pay a check to someone, and if they deposit that check, actually have them end up paying you money?

We recently got a check from our credit card company for some stupid figure like $8.50 but in real small writing below the amount box, it says 'by depositing this check your are joining the rewards program' which costs $100 a year.

I was wondering if anyone knew how this worked?

Is it something you setup with your banking facility or something you need to do via a 3rd party company?

I could see this having some very valuable uses in the adult industry.

Regards,

Lee

Lee,
The banks have nothing to do with it. I just asked my mom, who is an officer at the Federal Reserve in Denver. In fact, she told me that the banks are very hesitant to even cash them for people, and they (at least in Colorado) are required to put a 10 day hold on the funds to make sure you don't later decide to cancel them. I have mainly seen them in two areas:

1. Credit card programs wanting you to sign up for their protection and insurance plans

and

2. Sub-Prime lenders that pray on the stupidity of people.

Checks are legal doccuments, and any conditions that are spelled out on them as a condition of cashing are treated exactly as a contract in the eyes of the court. You need no special third party to set that up...just a printer and some blank checks from Office Max. Typical and standard contract law applies. You are giving someone something of value (the cash) in exchange for their signature and promise to participate in some program in the future.

Hope that helps.

Good luck. That is a great idea, although I always toss those checks into the shreader the second I get them.

Any idea what the 'official' name of this type of thing is called?

I did a quick search on the might G but couldnt find anything relevant.

Regards,

Lee

Could Chad please post on this?

Thanks

DEVELISH

At my moms branch they call them Promotional Checks. She says everyone she has seen has some connection (in one way or another) with VISA. (either directly, or through a VISA banking system.) She suggests that you contact:

Securities and Exchange Commision
Division of Consumer and Community Affairs
20th and C Streets, N.W., Stop 801
Washington, DC 20551
Phone: (202) 452-3693

And talk to them about what you are trying/wanting to do.

They can probably point you in the right direction...although since it is the Government, maybe not.

I used to have a rubber stamp that I'd had made, and when I had a contentious situation with someone like Chase Card Services or Pac Bell or somebody overcharging me for something, I'd send in a partial payment equal to the amount I owed minus the overcharge, and then I'd stamp the back of the check.

I have the language somewhere but it was something like "By cashing or depositing this check, the payee agrees to accept it as full and final payment for any and all debts due on the account number named on the face of the check as of the date of this check. Any attempted alteration of this check or these terms voids this check."

I successfully used that several times. It worked because the bozos that open and process the checks never bothered to look at what was stamped on the back.

The other place I saw it used years back was by long distance companies, where they'd send you a $50 check which, by depositing it, gave them permission to switch your LD carrier and sign you up at some ripoff rate.