If you lose your checkbook and a check is forged in your name, you are generally not liable; it is the responsibility of the bank to know the depositor.

Of course, it is in your own best interest to report the loss immediately to your bank. There are some special circumstances under which you might have trouble. For example, a skilled forger who has a sample of your signature may conceivably withdraw your entire balance. Informing the bank promptly will save you problems and, possibly in some limited circumstances, loss of funds.

Make certain to check the next monthly statement that you receive to discover whether you have been charged for a forged check.

Lost or misplaced bank credit cards or department store charge cards should be reported as soon as the loss is discovered. While the original card holder may be liable for a maximum of $50 (per card) — card issuers buy insurance against a thief’s shopping sprees or purchase of a first class flight to some distant pleasure island — it is nevertheless to your benefit to have those accounts closed and new registration numbers issued to you (and anyone else authorized to charge purchases on those accounts). If there have been charges which you did not make, you will have to go through the burden of having the billing corrected, including having to demonstrate that the purchases were not in fact made by you. To the extent that credit card issuers bear losses due to forged credit card purchases, there may be increased fees associated with procuring credit cards for all customers. And finally, there is a civic responsibility to report crime to appropriate officials.

It is important, therefore, to have an up-to-date list of your credit card numbers in a safe place other than the wallet or purse in which you carry your credit cards.

Holders of several cards may wish to purchase credit card insurance. For a modest fee, the insuring company retains the list of all of your account numbers and immediately notifies all of the issuers once you call to report a loss or theft. These companies also supply warning labels to paste on your credit cards, which, it is hoped, will deter a thief from making criminal use of the accounts.

How US Banks Treat Their Customers’ Privacy?

Although information about your bank accounts and transactions is usually a matter between your banker and yourself, there can be exceptions.

State laws vary on bank-account privacy. In some states banks are allowed to reveal to merchants whether a customer has sufficient funds to cover a large check a retailer has just been given for a purchase. Some banks will even reveal the exact balance in an account over the telephone. Check with your own bank as to its policy in this area.

On the other hand, the 1978 Right to Financial Privacy Act places limitations, in certain circumstances, on disclosure of your private bank records to federal officials. Not all requests by the government need be honored. Moreover, if a bank is asked or required to turn over your records to a federal agency, you will usually be notified of that fact.

A bank customer standing in line one evening to buy some theater tickets, discovered, when he got to the window, that his wallet was missing. In the jostling crowd, a professional pickpocket, Jimmy the Lift, had deftly removed the wallet, which contained several credit cards and a bank electronic fund transfer (EFT) card and personal identification number (PIN). The victim immediately called the credit card companies to notify them of the loss, but did not call the bank, on the assumption that it was closed.

Jimmy the Lift, being conversant with electronic banking, made his first stop at a nearby branch of his victim’s bank. He let himself into the bank’s 24-hour vestibule with the card, then withdrew $300, the maximum permitted in cash withdrawals at one time.

The next morning the victim called the bank as soon as it opened for business. Because he notified the bank within 48 hours of his loss, his personal liability was limited to $50 and the bank restored the remainder of $250 to his account.

Not so alert, or fortunate, was another of Jimmy’s targets, who also lost his EFT card and PIN to Jimmy’s educated hands. Unlike the first victim, this man neglected to notify his bank, and Jimmy made off with his savings as well as $1,000 from his automatic line of credit. Moreover, because the victim did not look at the bank statement on which these withdrawals appeared, but simply filed it away for examination several months later, he could not recover any of the stolen money. Since more than 60 days had by then elapsed between the time the bank sent him the statement and he reported the error, his liability was unlimited. (See discussion of Electronic Funds Transfer Act)

Moral: Never carry both your EFT card and your PIN together in your wallet or purse, and notify your bank immediately if your card has been stolen or misplaced.

Whean dealing with a bank, the first step is to try to establish yourself in its mind as a valued, or at least potentially valuable, customer, and to do it on a business like basis. It is important to get this impression across at the start. Never, never start a relationship with a bank by ‘walking in’ and going to the nearest bank officer and announcing ‘I want to open an account.’ Do that, and you are, in his mind, a ‘walk-in,’ and you lose. You are interrupting his work, and worse, coming at him unexpectedly. Beyond that, you are not being what he considers ‘businesslike.’ If he can spin you off down into the vulgar pits of the Special Checking Accounts, he will.

Instead, first learn as much about the bank and its services as you possibly can. Talk to friends, relatives, business associates, your lawyer, your accountant. Above all, ask someone in your company’s treasurer’s office, particularly if the company does business with the bank. If any of these people seems a particularly good reference, and is satisfied with the bank, ask for the name of a specific officer to whom you can speak, using your reference’s name — and, thus, his or her clout.

So, don’t pop in to see the officer unannounced. Call and make an appointment, preferably at the officer’s convenience. If you are capable of doing significant business with the bank — one or more family accounts, a separate business account, possibly trust or investment services — convey these facts immediately. The officer who sees you as someone with “potential,” is apt to give you full attention. Don’t try to impress the banker by spouting off numbers, and don’t launch into an angry attack on your present bank. If you do, you may be instantly labeled as a “bouncer,” one who unhappily goes from one bank to the next and might well choose another again in a month or two.

If you like the bank and are able to work out the details to your satisfaction, open a checking account, and a savings account too, if necessary, with as large a balance as you can reasonably afford. You are probably much better off putting all your accounts in one bank and doing business with it as a regular customer than spreading yourself thin over two or three banks, where you won’t mean much to anyone. Money talks. Even if you have only $5,000 in savings, deposit it all in one bank and let it talk for you there. If you have approached the bank correctly to begin with, you will indeed have a “personal banker” in the officer who signed you up. He or she may turn out to be the financial friend you need, bending the bank’s rules in your favor, if necessary, to get you a loan or offering sound financial advice.