okay this video was amazing, doing my CPA exams rn and thankfully I passed Reg but am now on audit. Halfway thru everythings been pretty straight forward until the cash cycle. Shortest lecture ever but dang was it confusing not just understanding each(Lapping and Kiting) but having to differentiate between the two yeeeshhhh. Thank you so much for this, becker really didn't cover this well and neither did my professors in college. Cheers and bless you brothaaaa!!
Anna Delvey brought me here lol. But I still don't understand how you can get the money so quickly. Checks are on hold for a few days until they clear.
Might have worked back in the day, or only at certain banks with certain types of accounts. My paycheck will clear two days early from the end of the month because I bank with a state employees credit union, but when I deposit a paper check, it will only clear $100 into my checking account before the entire amount is processed. Maybe if you have a business account or something special they allow all the funds to immediately be available. Also, it might depend on the time of day you deposit it.
That's quite intelligent (but also dangerous), because the more accounts you have, the more days you have to pay something off. The only issue (apart from going to jail), is keeping track of the order of the check writing sequence from respective banks, and having to write a check everyday.
A man from my state just got busted for doing this from 2015-2019 for over 10 million and I was like how could someone get a way with this so I had to look it up. Nice break down...
Hello, when a check is deposited into an account, doesn't the check go into a float field in the account into which it is deposited until it is cleared for pmt on the account from which is was withdrawn?In this way the customer should not be able to withdraw the $7,000.00 so quickly since it will be 'uncleared funds' until IF the $8,000.00 check is cleared for payment (via the clearing system) on the BOA a/c.
@@LordDirus007 Well what if someone deposits a $10,000 check then immediately withdraws say $9000 to go buy an icecream whadever, then the check bounces NSF, how will the bank get back the $9-grand when the icecream is already all gone?
@@ivornworrell They sell your debt to a debt collector. If you, eventually, don't pay the debt collector then they mark your credit score. If it's a substantial amount worth pursuing legal action, then they will. They can garnish your wage..etc. That's why when someone asks me, I always advise them to never ignore a debt collector.
Mmh I don't know. I thought about it seeing "Inventing Anna". I don't know how it works in the US, but here in EU you don't see any money in your bank account until the check is completely cleared, that's why it takes a lot of time to see money after a check deposit.
I don't get it, how a bank can credit fund immediately after depositing a check without actually clearing it ? how a check will be cleared if there is no fund in the account.
Working in finance, we see this a lot. Unfortunately it is the reason that innocent people have holds on their funds. Often times customers get upset when their checks are held after they deposit them. Why aren't they available right away? Why is there a 2 day hold? Why is there a Reg CC hold? (Rare) It's because of check kiting. We as the financial professionals know exactly what's going on, we don't say it though. Report it, let the fraud specialists do their investigation, and that's that. Awesome, clear video!
seems like this would not be that effective unless you were just trying to overstate your cash balance at year end to look better in your financials for the year
is this the "chase glitch" lol
okay this video was amazing, doing my CPA exams rn and thankfully I passed Reg but am now on audit. Halfway thru everythings been pretty straight forward until the cash cycle. Shortest lecture ever but dang was it confusing not just understanding each(Lapping and Kiting) but having to differentiate between the two yeeeshhhh. Thank you so much for this, becker really didn't cover this well and neither did my professors in college. Cheers and bless you brothaaaa!!
Omg you exactly said what I want to say thanks bro
Anna Delvey brought me here lol.
But I still don't understand how you can get the money so quickly. Checks are on hold for a few days until they clear.
I been seen this one but she brought me back as well to this video lol
Might have worked back in the day, or only at certain banks with certain types of accounts. My paycheck will clear two days early from the end of the month because I bank with a state employees credit union, but when I deposit a paper check, it will only clear $100 into my checking account before the entire amount is processed. Maybe if you have a business account or something special they allow all the funds to immediately be available. Also, it might depend on the time of day you deposit it.
That's quite intelligent (but also dangerous), because the more accounts you have, the more days you have to pay something off. The only issue (apart from going to jail), is keeping track of the order of the check writing sequence from respective banks, and having to write a check everyday.
Thanks sir, it was extremely well-put and I could get it really smoothly than my Prep-school's lengthy lecture.
Why can’t you just write the overdraft directly to the debtor? Why do you have to funnel through a second account?
A man from my state just got busted for doing this from 2015-2019 for over 10 million and I was like how could someone get a way with this so I had to look it up. Nice break down...
Great and simple explanation...unlike other vids.
Hello, when a check is deposited into an account, doesn't the check go into a float field in the account into which it is deposited until it is cleared for pmt on the account from which is was withdrawn?In this way the customer should not be able to withdraw the $7,000.00 so quickly since it will be 'uncleared funds' until IF the $8,000.00 check is cleared for payment (via the clearing system) on the BOA a/c.
Same point!
No, you can deposit up to $10,000 and it is available immediately. However sometimes the Bank will put a Hold on the check for 3 Days.
@@LordDirus007 Well what if someone deposits a $10,000 check then immediately withdraws say $9000 to go buy an icecream whadever, then the check bounces NSF, how will the bank get back the $9-grand when the icecream is already all gone?
@@ivornworrell They sell your debt to a debt collector. If you, eventually, don't pay the debt collector then they mark your credit score. If it's a substantial amount worth pursuing legal action, then they will. They can garnish your wage..etc. That's why when someone asks me, I always advise them to never ignore a debt collector.
@@GRSAFseventhousand but spose u aint got no wage to garnish, spose u flat broke bcz u done spent all the money??
Mmh I don't know. I thought about it seeing "Inventing Anna". I don't know how it works in the US, but here in EU you don't see any money in your bank account until the check is completely cleared, that's why it takes a lot of time to see money after a check deposit.
I don't get it, how a bank can credit fund immediately after depositing a check without actually clearing it ? how a check will be cleared if there is no fund in the account.
all banks are in competition to see who can disperse funds the fastest so basically they would rather you go thru them thn take it some where els.
Short & Sweet Explanation.. Appreciate it. Thanks
thank you so much for this explanation. I was more than a little confused about this before but I understand now
Well explained 👍
Thank you!
thank you so much sir
No problem!
Great explanation, thank you
Working in finance, we see this a lot. Unfortunately it is the reason that innocent people have holds on their funds.
Often times customers get upset when their checks are held after they deposit them. Why aren't they available right away? Why is there a 2 day hold? Why is there a Reg CC hold? (Rare)
It's because of check kiting. We as the financial professionals know exactly what's going on, we don't say it though. Report it, let the fraud specialists do their investigation, and that's that.
Awesome, clear video!
Great video
Today is the first time that I've seen the expression. I didn't know what it meant.
Thank you ❤
Great video thanks
seems like this would not be that effective unless you were just trying to overstate your cash balance at year end to look better in your financials for the year
Great Man! Thx
Very good video
Wells fargo and bank of America are pretty much the same bank so it wouldn't work.
Wow
wonderful explanation. Thank you