403.5 Replacement & Returned Checks

A replacement check may be issued when the payee dies or when the original check is lost, stolen, or destroyed. A duplicate check is issued payable to the payee, owner, legal representative of the owner, or heir as appropriate. Replacement procedure depends on the check type -- payroll or accounts payable. Undeliverable checks and checks to be cancelled should be returned to Campus Accounting Services team, or payroll office, in the case of payroll checks. PSU seeks to ensure that the high-level roles and responsibilities related to replacement and returned checks are documented, communicated, and clearly understood and applied.

LOST, STOLEN, AND DESTROYED CHECKS: When the payee, owner, or legal representative requests a duplicate check, the Campus Accounting Services team or payroll office should first verify that the original check must be replaced. This includes determining whether the original check was addressed correctly and ensuring that it is not being held for the payee.

Payments issued to employees, such as payroll wages and travel expense reimbursements, are distributed according to the entries on Banner forms. Banking and mailing address information can be verified on those forms.

Accounts payable checks are distributed according to instructions on the disbursement document, which should be checked for accuracy.

LOST CHECK STATEMENT: A Lost Check Statement is used to request replacement of a missing check. After it has been confirmed that the original check was issued, cannot be found, has not been cashed and must be replaced, the payee or owner should be given a Lost Check Statement and instructions for replacing the check. The completed form must be sent to the Campus Accounting Services team or payroll office.

OBTAIN PAYMENT DUE A DECEASED PERSON: The Lost Check Statement must be completed by a survivor before any funds due a deceased person can be paid to the survivor. In signing the affidavit, the claimant affirms that:

no survivor of higher priority exists,
the estate is not subject to probate, and
no more than $1,000 is due the decedent from the State of Oregon from sources other than salary and wages.

These matters should be discussed with the claimant. PSU is not responsible for determining the truth of the affidavit.

Priority of Survivors: Only a person in the group of survivors with highest priority can file this form. Claimants with equal priority must complete separate forms. Following is the order of priority:

Surviving spouse
Children and children of a deceased child by right of representation
Parents
Brothers and sisters
Nephews and nieces

Payment Limitations: No limit exists on the amount paid to claimants for salary and wages. The maximum payment from all state departments from sources other than salary and wages is $1,000. If the total due from other sources exceeds $1,000, the decedent's estate is paid the full amount.

Payment to the Estate: Payments to the decedent's estate require no affidavit. The estate's executor or administrator may cash a check issued to the decedent by attaching the "letters of administration" issued by the court.

Processing Affidavits: The claimant must mail, fax or deliver the following to PSU before the lost check statement can be processed:

Affidavit only if no check was issued
Affidavit with the check attached if a check was issued
Affidavit with a Lost Check Statement attached if a check was issued but was lost, stolen or destroyed sent to the Campus Accounting Services team or payroll office.

CHECK LOST BY A BANK: When a bank is the owner (but not the payee) of a check lost within its own system, no Lost Check Statement is required. The bank merely sends a photocopy of the check with an explanation and request for payment to the Campus Accounting Services team.

After verifying that the check is outstanding, the Campus Accounting Services team requests a letter of indemnity from the bank. Once the letter is received, Campus Accounting Services team issues a check to the bank.

REPLACEMENT CHECKS: When the Campus Accounting Services team or payroll office receives a Lost Check Statement it proceeds in one of two ways:

If the check was an accounts payable check, the Campus Accounting Services team issues a replacement.
If the check was a payroll check, the PSU’s payroll office issues a replacement.

The replacement check is usually issued within three working days and is sent to the payee or owner according to the delivery arrangements made with the Campus Accounting Services or payroll office.

CHECKS MORE THAN TWO YEARS OLD: At the end of each fiscal year, funds for outstanding checks more than two years old are transferred to the State Landboard.

Once a year, in September or October, checks more than two years old are purged from the outstanding check list. All funds, except for auxiliary enterprise and student loan account funds, revert to the Division of State Lands. For replacement, the payee should contact the Division of State Lands, 775 Summer St. N.E., Salem, Oregon, 97310-1337, (503) 378-3805.

Funds from unclaimed checks written on student loan accounts are reviewed by institution business offices. Title IV money cannot revert to the State.

ACTION WHEN REPLACEMENT CHECK IS ISSUED: When a replacement check is issued, PSU is responsible for avoiding loss from both original and replacement checks being cashed.

When an alleged lost, stolen or destroyed check and its replacement are both cashed, the PSU will immediately sets up a receivable on the books. PSU will pursue collection efforts for the amount of the replacement check.

CHECKS RETURNED FOR CANCELLATIONS: Before a check can be cancelled, the original check must be delivered to the Campus Accounting Services team or payroll office. Mark checks to be cancelled "cancellation." Also mark over the signature. Do not remove the signature block. The Campus Accounting Services team is responsible for cancellation of accounts payable checks and those issued by Student Financial Services. PSU’s payroll office is responsible for cancellation of payroll checks.