{"identifier":"/us/usc/t12/s5002","title":12,"num":"\u00a7\u202f5002.","heading":"Definitions","text":"\u00a7\u202f5002.\nDefinitions\nFor purposes of this chapter, the following definitions shall apply:\n(1)\nAccount\nThe term \u201caccount\u201d means a deposit account at a bank.\n(2)\nBank\nThe term \u201cbank\u201d means any person that is located in a State and engaged in the business of banking and includes\u2014\n(A) any depository institution (as defined in\nsection 461(b)(1)(A) of this title\n(B) any Federal reserve bank;\n(C) any Federal home loan bank; or\n(D) to the extent it acts as a payor\u2014\n(i) the Treasury of the United States;\n(ii) the United States Postal Service;\n(iii) a State government; or\n(iv) a unit of general local government (as defined in\nsection 4001(24) of this title\n(3)\nBanking terms\n(A)\nCollecting bank\nThe term \u201ccollecting bank\u201d means any bank handling a check for collection except the paying bank.\n(B)\nDepositary bank\nThe term \u201cdepositary bank\u201d means\u2014\n(i) the first bank to which a check is transferred, even if such bank is also the paying bank or the payee; or\n(ii) a bank to which a check is transferred for deposit in an account at such bank, even if the check is physically received and indorsed first by another bank.\n(C)\nPaying bank\nThe term \u201cpaying bank\u201d means\u2014\n(i) the bank by which a check is payable, unless the check is payable at or through another bank and is sent to the other bank for payment or collection; or\n(ii) the bank at or through which a check is payable and to which the check is sent for payment or collection.\n(D)\nReturning bank\n(i)\nIn general\nThe term \u201creturning bank\u201d means a bank (other than the paying or depositary bank) handling a returned check or notice in lieu of return.\n(ii)\nTreatment as collecting bank\nNo provision of this chapter shall be construed as affecting the treatment of a returning bank as a collecting bank for purposes of section 4\u2013202(b) of the Uniform Commercial Code.\n(4)\nBoard\nThe term \u201cBoard\u201d means the Board of Governors of the Federal Reserve System.\n(5)\nBusiness day\nThe term \u201cbusiness day\u201d has the same meaning as in\nsection 4001(3) of this title\n(6)\nCheck\nThe term \u201ccheck\u201d\u2014\n(A) means a draft, payable on demand and drawn on or payable through or at an office of a bank, whether or not negotiable, that is handled for forward collection or return, including a substitute check and a travelers check; and\n(B) does not include a noncash item or an item payable in a medium other than United States dollars.\n(7)\nConsumer\nThe term \u201cconsumer\u201d means an individual who\u2014\n(A) with respect to a check handled for forward collection, draws the check on a consumer account; or\n(B) with respect to a check handled for return, deposits the check into, or cashes the check against, a consumer account.\n(8)\nConsumer account\nThe term \u201cconsumer account\u201d has the same meaning as in\nsection 4001(10) of this title\n(9)\nCustomer\nThe term \u201ccustomer\u201d means a person having an account with a bank.\n(10)\nForward collection\nThe term \u201cforward collection\u201d means the transfer by a bank of a check to a collecting bank for settlement or the paying bank for payment.\n(11)\nIndemnifying bank\nThe term \u201cindemnifying bank\u201d means a bank that is providing an indemnity under\nsection 5005 of this title\n(12)\nMICR line\nThe terms \u201cMICR line\u201d and \u201cmagnetic ink character recognition line\u201d mean the numbers, which may include the bank routing number, account number, check number, check amount, and other information, that are printed near the bottom of a check in magnetic ink in accordance with generally applicable industry standards.\n(13)\nNoncash item\nThe term \u201cnoncash item\u201d has the same meaning as in\nsection 4001(14) of this title\n(14)\nPerson\nThe term \u201cperson\u201d means a natural person, corporation, unincorporated company, partnership, government unit or instrumentality, trust, or any other entity or organization.\n(15)\nReconverting bank\nThe term \u201creconverting bank\u201d means\u2014\n(A) the bank that creates a substitute check; or\n(B) if a substitute check is created by a person other than a bank, the first bank that transfers or presents such substitute check.\n(16)\nSubstitute check\nThe term \u201csubstitute check\u201d means a paper reproduction of the original check that\u2014\n(A) contains an image of the front and back of the original check;\n(B) bears a MICR line containing all the information appearing on the MICR line of the original check, except as provided under generally applicable industry standards for substitute checks to facilitate the processing of substitute checks;\n(C) conforms, in paper stock, dimension, and otherwise, with generally applicable industry standards for substitute checks; and\n(D) is suitable for automated processing in the same manner as the original check.\n(17)\nState\nThe term \u201cState\u201d has the same meaning as in\nsection 1813(a) of this title\n(18)\nTruncate\nThe term \u201ctruncate\u201d means to remove an original paper check from the check collection or return process and send to a recipient, in lieu of such original paper check, a substitute check or, by agreement, information relating to the original check (including data taken from the MICR line of the original check or an electronic image of the original check), whether with or without subsequent delivery of the original paper check.\n(19)\nUniform Commercial Code\nThe term \u201cUniform Commercial Code\u201d means the Uniform Commercial Code in effect in a State.\n(20)\nOther terms\nUnless the context requires otherwise, the terms not defined in this section shall have the same meanings as in the Uniform Commercial Code.","url":"https://projectusc.org/usc/t12/s5002.html","content":[{"t":"sec","id":"/us/usc/t12/s5002","children":[{"t":"num","text":"\u00a7\u202f5002."},{"t":"heading","text":"Definitions","tail":"\n"},{"t":"chapeau","text":"For purposes of this chapter, the following definitions shall apply:"},{"t":"para","id":"/us/usc/t12/s5002/1","children":[{"t":"num","text":"(1)"},{"t":"heading","text":"Account"},{"t":"content","children":[{"t":"p","text":"The term \u201caccount\u201d means a deposit account at a bank.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/2","children":[{"t":"num","text":"(2)"},{"t":"heading","text":"Bank"},{"t":"chapeau","text":"The term \u201cbank\u201d means any person that is located in a State and engaged in the business of banking and includes\u2014"},{"t":"subpara","id":"/us/usc/t12/s5002/2/A","children":[{"t":"num","text":"(A)"},{"t":"content","text":" any depository institution (as defined in ","children":[{"t":"ref","text":"section 461(b)(1)(A) of this title","href":"/us/usc/t12/s461/b/1/A","tail":");"}],"tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t12/s5002/2/B","children":[{"t":"num","text":"(B)"},{"t":"content","text":" any Federal reserve bank;","tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t12/s5002/2/C","children":[{"t":"num","text":"(C)"},{"t":"content","text":" any Federal home loan bank; or","tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t12/s5002/2/D","children":[{"t":"num","text":"(D)"},{"t":"chapeau","text":" to the extent it acts as a payor\u2014"},{"t":"clause","id":"/us/usc/t12/s5002/2/D/i","children":[{"t":"num","text":"(i)"},{"t":"content","text":" the Treasury of the United States;","tail":"\n"}],"tail":"\n"},{"t":"clause","id":"/us/usc/t12/s5002/2/D/ii","children":[{"t":"num","text":"(ii)"},{"t":"content","text":" the United States Postal Service;","tail":"\n"}],"tail":"\n"},{"t":"clause","id":"/us/usc/t12/s5002/2/D/iii","children":[{"t":"num","text":"(iii)"},{"t":"content","text":" a State government; or","tail":"\n"}],"tail":"\n"},{"t":"clause","id":"/us/usc/t12/s5002/2/D/iv","children":[{"t":"num","text":"(iv)"},{"t":"content","text":" a unit of general local government (as defined in ","children":[{"t":"ref","text":"section 4001(24) of this title","href":"/us/usc/t12/s4001/24","tail":")."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/3","children":[{"t":"num","text":"(3)"},{"t":"heading","text":"Banking terms"},{"t":"subpara","id":"/us/usc/t12/s5002/3/A","children":[{"t":"num","text":"(A)"},{"t":"heading","text":"Collecting bank"},{"t":"content","children":[{"t":"p","text":"The term \u201ccollecting bank\u201d means any bank handling a check for collection except the paying bank.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t12/s5002/3/B","children":[{"t":"num","text":"(B)"},{"t":"heading","text":"Depositary bank"},{"t":"chapeau","text":"The term \u201cdepositary bank\u201d means\u2014"},{"t":"clause","id":"/us/usc/t12/s5002/3/B/i","children":[{"t":"num","text":"(i)"},{"t":"content","text":" the first bank to which a check is transferred, even if such bank is also the paying bank or the payee; or","tail":"\n"}],"tail":"\n"},{"t":"clause","id":"/us/usc/t12/s5002/3/B/ii","children":[{"t":"num","text":"(ii)"},{"t":"content","text":" a bank to which a check is transferred for deposit in an account at such bank, even if the check is physically received and indorsed first by another bank.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t12/s5002/3/C","children":[{"t":"num","text":"(C)"},{"t":"heading","text":"Paying bank"},{"t":"chapeau","text":"The term \u201cpaying bank\u201d means\u2014"},{"t":"clause","id":"/us/usc/t12/s5002/3/C/i","children":[{"t":"num","text":"(i)"},{"t":"content","text":" the bank by which a check is payable, unless the check is payable at or through another bank and is sent to the other bank for payment or collection; or","tail":"\n"}],"tail":"\n"},{"t":"clause","id":"/us/usc/t12/s5002/3/C/ii","children":[{"t":"num","text":"(ii)"},{"t":"content","text":" the bank at or through which a check is payable and to which the check is sent for payment or collection.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t12/s5002/3/D","children":[{"t":"num","text":"(D)"},{"t":"heading","text":"Returning bank"},{"t":"clause","id":"/us/usc/t12/s5002/3/D/i","children":[{"t":"num","text":"(i)"},{"t":"heading","text":"In general"},{"t":"content","children":[{"t":"p","text":"The term \u201creturning bank\u201d means a bank (other than the paying or depositary bank) handling a returned check or notice in lieu of return.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"clause","id":"/us/usc/t12/s5002/3/D/ii","children":[{"t":"num","text":"(ii)"},{"t":"heading","text":"Treatment as collecting bank"},{"t":"content","children":[{"t":"p","text":"No provision of this chapter shall be construed as affecting the treatment of a returning bank as a collecting bank for purposes of section 4\u2013202(b) of the Uniform Commercial Code.","tail":"\n"}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/4","children":[{"t":"num","text":"(4)"},{"t":"heading","text":"Board"},{"t":"content","children":[{"t":"p","text":"The term \u201cBoard\u201d means the Board of Governors of the Federal Reserve System.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/5","children":[{"t":"num","text":"(5)"},{"t":"heading","text":"Business day"},{"t":"content","children":[{"t":"p","text":"The term \u201cbusiness day\u201d has the same meaning as in ","children":[{"t":"ref","text":"section 4001(3) of this title","href":"/us/usc/t12/s4001/3","tail":"."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/6","children":[{"t":"num","text":"(6)"},{"t":"heading","text":"Check"},{"t":"chapeau","text":"The term \u201ccheck\u201d\u2014"},{"t":"subpara","id":"/us/usc/t12/s5002/6/A","children":[{"t":"num","text":"(A)"},{"t":"content","text":" means a draft, payable on demand and drawn on or payable through or at an office of a bank, whether or not negotiable, that is handled for forward collection or return, including a substitute check and a travelers check; and","tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t12/s5002/6/B","children":[{"t":"num","text":"(B)"},{"t":"content","text":" does not include a noncash item or an item payable in a medium other than United States dollars.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/7","children":[{"t":"num","text":"(7)"},{"t":"heading","text":"Consumer"},{"t":"chapeau","text":"The term \u201cconsumer\u201d means an individual who\u2014"},{"t":"subpara","id":"/us/usc/t12/s5002/7/A","children":[{"t":"num","text":"(A)"},{"t":"content","text":" with respect to a check handled for forward collection, draws the check on a consumer account; or","tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t12/s5002/7/B","children":[{"t":"num","text":"(B)"},{"t":"content","text":" with respect to a check handled for return, deposits the check into, or cashes the check against, a consumer account.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/8","children":[{"t":"num","text":"(8)"},{"t":"heading","text":"Consumer account"},{"t":"content","children":[{"t":"p","text":"The term \u201cconsumer account\u201d has the same meaning as in ","children":[{"t":"ref","text":"section 4001(10) of this title","href":"/us/usc/t12/s4001/10","tail":"."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/9","children":[{"t":"num","text":"(9)"},{"t":"heading","text":"Customer"},{"t":"content","children":[{"t":"p","text":"The term \u201ccustomer\u201d means a person having an account with a bank.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/10","children":[{"t":"num","text":"(10)"},{"t":"heading","text":"Forward collection"},{"t":"content","children":[{"t":"p","text":"The term \u201cforward collection\u201d means the transfer by a bank of a check to a collecting bank for settlement or the paying bank for payment.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/11","children":[{"t":"num","text":"(11)"},{"t":"heading","text":"Indemnifying bank"},{"t":"content","children":[{"t":"p","text":"The term \u201cindemnifying bank\u201d means a bank that is providing an indemnity under ","children":[{"t":"ref","text":"section 5005 of this title","href":"/us/usc/t12/s5005","tail":" with respect to a substitute check."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/12","children":[{"t":"num","text":"(12)"},{"t":"heading","text":"MICR line"},{"t":"content","children":[{"t":"p","text":"The terms \u201cMICR line\u201d and \u201cmagnetic ink character recognition line\u201d mean the numbers, which may include the bank routing number, account number, check number, check amount, and other information, that are printed near the bottom of a check in magnetic ink in accordance with generally applicable industry standards.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/13","children":[{"t":"num","text":"(13)"},{"t":"heading","text":"Noncash item"},{"t":"content","children":[{"t":"p","text":"The term \u201cnoncash item\u201d has the same meaning as in ","children":[{"t":"ref","text":"section 4001(14) of this title","href":"/us/usc/t12/s4001/14","tail":"."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/14","children":[{"t":"num","text":"(14)"},{"t":"heading","text":"Person"},{"t":"content","children":[{"t":"p","text":"The term \u201cperson\u201d means a natural person, corporation, unincorporated company, partnership, government unit or instrumentality, trust, or any other entity or organization.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/15","children":[{"t":"num","text":"(15)"},{"t":"heading","text":"Reconverting bank"},{"t":"chapeau","text":"The term \u201creconverting bank\u201d means\u2014"},{"t":"subpara","id":"/us/usc/t12/s5002/15/A","children":[{"t":"num","text":"(A)"},{"t":"content","text":" the bank that creates a substitute check; or","tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t12/s5002/15/B","children":[{"t":"num","text":"(B)"},{"t":"content","text":" if a substitute check is created by a person other than a bank, the first bank that transfers or presents such substitute check.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/16","children":[{"t":"num","text":"(16)"},{"t":"heading","text":"Substitute check"},{"t":"chapeau","text":"The term \u201csubstitute check\u201d means a paper reproduction of the original check that\u2014"},{"t":"subpara","id":"/us/usc/t12/s5002/16/A","children":[{"t":"num","text":"(A)"},{"t":"content","text":" contains an image of the front and back of the original check;","tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t12/s5002/16/B","children":[{"t":"num","text":"(B)"},{"t":"content","text":" bears a MICR line containing all the information appearing on the MICR line of the original check, except as provided under generally applicable industry standards for substitute checks to facilitate the processing of substitute checks;","tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t12/s5002/16/C","children":[{"t":"num","text":"(C)"},{"t":"content","text":" conforms, in paper stock, dimension, and otherwise, with generally applicable industry standards for substitute checks; and","tail":"\n"}],"tail":"\n"},{"t":"subpara","id":"/us/usc/t12/s5002/16/D","children":[{"t":"num","text":"(D)"},{"t":"content","text":" is suitable for automated processing in the same manner as the original check.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/17","children":[{"t":"num","text":"(17)"},{"t":"heading","text":"State"},{"t":"content","children":[{"t":"p","text":"The term \u201cState\u201d has the same meaning as in ","children":[{"t":"ref","text":"section 1813(a) of this title","href":"/us/usc/t12/s1813/a","tail":"."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/18","children":[{"t":"num","text":"(18)"},{"t":"heading","text":"Truncate"},{"t":"content","children":[{"t":"p","text":"The term \u201ctruncate\u201d means to remove an original paper check from the check collection or return process and send to a recipient, in lieu of such original paper check, a substitute check or, by agreement, information relating to the original check (including data taken from the MICR line of the original check or an electronic image of the original check), whether with or without subsequent delivery of the original paper check.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/19","children":[{"t":"num","text":"(19)"},{"t":"heading","text":"Uniform Commercial Code"},{"t":"content","children":[{"t":"p","text":"The term \u201cUniform Commercial Code\u201d means the Uniform Commercial Code in effect in a State.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"para","id":"/us/usc/t12/s5002/20","children":[{"t":"num","text":"(20)"},{"t":"heading","text":"Other terms"},{"t":"content","children":[{"t":"p","text":"Unless the context requires otherwise, the terms not defined in this section shall have the same meanings as in the Uniform Commercial Code.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"text","text":"\n"},{"t":"text","text":"\n"}]}]}