What Are Bank Draft Checks?

Depending on the financial institution, a bank draft may receive the name "Cashiers Check," "Official Check," "Teller's Check," "Treasurer's Check" or "Manager's Check." All of these terms refer to a type of monetary instrument that can be presented for payment for goods or services.

Definition

A bank draft check is a check purchased by a customer of a financial institution and written from a financial institution's accounts.

Function

The purpose of a bank draft is to provide check payment in a form that is typically more secure than a personal check. Since it is drawn on a bank's account, there is less of a chance that the check will be bad.

Features

A bank draft check features the date, the name of the person or business being paid with the check, the amount of the check and the signature of one or more officers or supervisors of the bank. Some banks also imprint or stamp the check with the amount in addition to typing, printing or hand-writing the numbers.

Requirements

Most financial institutions only sell bank draft checks to account-holders. The purchase of draft checks requires guaranteed funds, such as cash or a withdrawal from a checking or savings account housed at the financial institution.

Warning

Although they typically provide less risk than personal checks, counterfeiters have begun to produce phony bank draft checks. Always exercise caution if you receive a bank draft check to pay for an Internet auction or purchase, or if a bank draft check arrives in the mail with a letter that you have won a lottery or have been offered a work-at-home opportunity. These are potential scams.

References

• FakeChecks.org: Preventing Check Scams