Can you still cash checks in St. Maarten?

We have said it so often now, it is becoming like a mantra. Not because something is common practice means it is legal. Banks have been blocking checks deposited from other banks for so long that it has become commonplace to hear the teller say that the check will be blocked for 5 days until the check clears, that we have taken it for granted.

It is of course understandable that checks have to clear first before you get access to the money. But the law is clear on the topic of issuing checks. You are only allowed to issue a check if you have the money on your checking account to cover it. If you write out a check and you do not have the funds to cover the check and the check bounces, that is fraud, plain and simple. But mistakes happen. So we understand the 5-days hold on a check until it clears, especially since it is from another bank.

However, WIB bank has now introduced a new policy without making it known to the general public that all WIB checks have to be deposited and put on hold for 24-hours if deposited on a WIB account. It cannot be cashed.

First of all, that doesn’t make any sense. Can’t WIB just check to see if the funds are on the account to cover the check? After all, it is a WIB check drawn against a WIB bank account, right?

Secondly, has WIB gotten approval from the Central Bank for this new policy? Is this new policy even legal? Finally, has WIB made this new policy known to the general public?

When asked about this, Cor Merx of the Consumer Protection Foundation was very clear: “I am not interested in knowing why the banks are doing this, all I am interested in knowing is if this is allowed.” According to Merx, blocking a check in this manner is not allowed.

So we sent off an email with a series of questions about this to the Central Bank of Curacao and St. Maarten and we will be patiently awaiting the answers. Once we have the answers, we will let you know whether the banks are allowed to block checks, stop you from cashing checks and forcing you to deposit these checks and putting them on hold until they clear.

It might take some time to get answers from the Central Bank, because we know they are quite busy and have their hands full with the Ennia case.