Certified cheques are 'almost as good as cash,' banking expert says
Louis Kavaratzis says his retirement plans are ruined after Canada Post misplaced a piece of registered mail that contained a certified cheque for $301,560 — money left for him in his late father's will.
His brother, George Kavaratzis, sent the cheque from their father's estate through registered mail from Campbellford, Ont., to Louis in Ayer's Cliff, Que., on July 25.
But the cheque has seemingly vanished and the brothers have spent every day since trying to track it down with Canada Post, and to get TD Bank to stop or otherwise flag it and issue a new one. However, they say neither institution has offered much help.
It was going to greatly benefit my retirement. I wanted to invest it, Louis, 57, said of his lost inheritance.
My dreams are dashed of that ever happening.
The emotional upheaval that is just eating away at me on a minute-by-minute basis; you can't stop thinking about it.
After CBC Toronto contacted TD this week, it offered to issue a new cheque with the condition George sign an indemnity agreement, which means he would be held liable for the money if the original cheque is ever found and cashed by someone else.
George says he declined, and instead offered to sign an agreement that says he'd be liable for $150,000. He says he isn't comfortable with the risk of having to repay the full amount. He also says he's done nothing wrong so shouldn't be the one on the hook.
For the rest of my life I'm going to be looking over my shoulder; Is this the year they're going to cash it? he said.
Canada Post apologizes, investigates
Canada Post didn't answer a list of questions from CBC News, but apologized to the brothers in a statement for the
unfortunate and frustrating delivery experience.
Spokesperson Janick Cormier said the Crown corporation still hasn't been able to find the envelope.
We understand the concerns they raised with respect to how this important delivery was handled and we are investigating, Cormier said in an email.
When this issue was first raised, we conducted a thorough search of our facilities and we continue to monitor our operations for the item.
Canada Post has not offered the brothers any compensation.
Lost within hours
George chose to send the cheque through registered mail because it provides confirmation Canada Post received the item and proof of delivery by requiring a signature by the recipient.
You'd think it would be safe, George said.
Canada Post's website estimates it takes four business days for registered mail to cross the country. When CBC News checked the tracking number assigned to the Kavaratzis item, it shows it took nearly double the time.
The envelope went some 40 kilometres from Campbellford to Peterborough, then was re-routed back and forth between Peterborough and Toronto twice, due to processing errors, before finally arriving in Ayer's Cliff on Aug. 3.
Based on the tracking information, a notice card was left in Louis's mailbox at the post office on that day at 8:25 a.m., alerting him to pick up the envelope. But when he went to retrieve it, he says a staff member told him they remember handling the item, but couldn't find it.
I was just in astonishment, Louis said.
How do you lose a piece of registered mail within two hours?
In the village of Ayer's Cliff — nearly 150 kilometres southeast of Montreal — mail is delivered to residents' mailboxes located inside the local post office. That means if the envelope arrived at the post office when it said, it shouldn't have left the building before Louis went to pick it up a couple of hours later.
He says he went back to the post office several times, but the envelope didn't turn up.
On Aug. 8 at 1:47 p.m., the online tracking tool indicated the item was still in Ayer's Cliff and said:
Final Notice; Item will be returned to sender if not collected within 10 days.
But, under that same date and time stamp, it shows the item was delivered and signed for in Campbellford. A document shows George's signature on that date, but George is adamant he didn't sign for, or receive, the item.
He says staff at the Campbellford post office told him his signature was scanned by mistake.
It was never picked up. It was never there, George said.
Nobody knows where it is.
Can't stop payment
While the brothers blame Canada Post for losing the cheque, they wanted TD to put security measures on it and issue a new one.
George, who is the executor of his father's estate, says when he asked the bank for certified cheques there wasn't a conversation about where they were going or whether there was a more secure way of sending the funds.
An Aug. 11 letter from George's lawyer to the bank indicates TD couldn't put a stop payment on the cheque and instead asks it to be flagged in case someone else attempts to cash it.
George says after CBC News contacted the bank this week, TD flagged the cheque and offered the indemnity agreement.
TD spokesperson Ashleigh Murphy says the bank doesn't comment on the specifics of a customer issue, but confirms it's working with George on
Murphy said in a statement the bank has a
regular process to deal with lost certified cheques, but says if it's deposited the money will go through. She says the bank where it's deposited will be available.
No stop payment can be lodged on a certified cheque or draft, as they are considered forms of certified funds, where essentially the piece of paper is worth the money, Murphy said.
'Almost as good as cash'
Banking expert Omar Fares says a wire transfer is the most secure way to send large sums of money, followed by a bank draft, then a certified cheque.
Fares, who is not involved in the case and spoke to CBC News in general, says a certified cheque is
almost as good as cash but the person cashing it would very likely be asked to provide ID that matches who the cheque is made out to, and proof of a bank account with the same name.
He says while banks take extra precaution with cheques of more than $10,000, fraud is rampant.
"If the wrong person gets a hold of a cheque there are layers of protection," said Fares, who lectures at Toronto Metropolitan University's Ted Rogers School of Retail Management.
- Inheritance found: UPS tracks down missing $36,000 bank draft weeks after it was mailed from Edmonton (new window)
But, if the wrong person gets a hold of the cheque, this can definitely be problematic and it can be very hard to be stopped.
Fares says it's not the responsibility of a bank employee to tell a customer which method of sending money is the most secure, but says from an advisory and customer service standpoint, an employee could
go the extra mile by informing the customer.
The brothers say the whole ordeal is even more difficult considering their parents sacrificed a lot and worked hard to support their family.
My parents came over as immigrants in the 1950s and worked hard all their whole life and now they're gone, George said.
They've passed on what was left to their children. This is what's become of it? It's horrible.