What to Do When There Is a Hold on Your Bank Account
- Regulation CC, or the Expedited Funds Availability Act, is a law that governs how banks make funds available to their customers. Regulations are set for how long banks can place holds on deposits, and they differ depending on the transaction. For example, direct deposits must be made available on the day of payment, and cashier's checks must be made available the next business day. Regulation CC requires banks to inform you whenever a hold is placed on your deposit.
- A bank puts a hold on a deposit when it has reason to believe funds will not be collected. New account openings, depositing money orders or cashier's checks, or unusually large deposits are common reasons for deposit holds. If a bank places a hold on your deposit, it can be removed if the receiving banks verifies the funds have been collected from the originating bank. You can usually do this by contacting a bank official from the receiving bank.
- New account openings have an increased frequency of deposit holds. Account fraud happens most often when an account is first opened. A bank account is considered new for 30 calendar days after it has been opened. If you already have an account with a bank, a second one will not be considered new as far as Regulation CC is concerned. If you need funds from a new account quickly, it's a good idea to deposit cash instead of a check, because cash is required to be made available more quickly.
- If you feel a bank has unfairly placed a hold on your deposit you are entitled to file a complaint with the Federal Reserve. Reasons for filing a complaint can include failure to notify you of a deposit hold or holding funds for an excessive amount of time. The Federal Reserve recommends trying to settle the issue with your bank first because resolving a dispute can take up to 60 days.