Fascinating, is there ever a point where this "magic money" legally becomes your property, after a certain amount of time?

Check with a lawyer, this varies all over the world and you don't want to mess this up. Not only might the money become theirs again, it might become theirs with interest. Though you might be able to charge them storage fees. don't forget that laws change so keep in touch with your lawyers so they notify you when laws changes so you can remain complaint. Make sure you keep record of what the lawyers say as well - if (when?) you mess something up record of trying to do the right thing can work to your favor in court.

I was just a kid at the time, I can't remember what they did with it over time. I do remember it getting pretty large one time and the executives were nervous about this pile of money they didn't know what to do with. The CEO/owner was a very honorable and decent guy though and I have 100% confidence whatever was the RightThing(tm) to do is what he did.

heh 20 something years later and he still takes my calls to listen to my crazy business ideas.

There was a fairly recent case [0] exploring a situation in which the amount of time is 0. In that jurisdiction, if somebody owes you money and pays you money, they aren't entitled for that particular payment to be returned just because it was an "accident".

[0] https://www.google.com/amp/s/amp.cnn.com/cnn/2021/02/16/busi...

That ruling was overturned on appeal.

https://www.reuters.com/markets/us/citigroup-wins-appeal-ove...

Interesting!

that is a different case. That was a payment on a real debt, just earlier than intended (and due to a mistake).

The top comment was talking about money that wasn't even billed. They don't have any actual service or product it was tied back to. Also if they do have agreements with that insurer (just no payments pending), there is going to be a contract overriding default law which probably covers how to handle mistakes.

The "if they owe you money" is very important here.

The question was obviously referring to money not owed.

Absolutely (hence the low word count, many of which were dedicated to highlighting that distinction). When learning about a topic though, it's helpful to explore surrounding ideas.

In the US, you are supposed to turn it over to the state, and the government holds it for an extremely long time until it's owner claims it.

Also, you're probably not going to win a dispute with a / the state. The USA government stole my money once (bank transfer). It was a rent payment to a landlord with a Muslim-sounding name. I contested it by sending in their form with the case number that they'd provided me.

They responded saying they had no case matching my info. I gave up before investing more time because I thought it was unlikely to end well for the amount of effort I'd have to invest.

I started directly depositing money orders into his account. No problems after that. The USA government profited one month of my rental rate. I nearly got evicted when my rent wasn't delivered. No explanation was ever given to me.

Ah but if you _do_ want to win a dispute with the state, you must not give up when you hit a logical contradiction. The only way out is through.

This isn't "I lose a dispute with the state," it's "I hit a pebble-sized roadblock and immediately gave up."

I'm glad that a month's rent isn't a lot of money to you but this probably shouldn't inform your opinion on how it is to interact with the state.

Short answer "it depends." Long answer:

It depends on your jurisdiction, the entities involved, the amount of money involved, and probably more. However, it's not possible to know ahead of time, you'd need to go to court and argue why this entity is being unreasonable in demanding the money be returned.

Depends on the jurisdiction but typically no.

Why did you cash/deposit the checks?

It’s way easier and more reliable to keep track of money in an accounting system than in random tiny pieces of paper. Money is safer in a bank account than as a tiny piece of paper.

In terms of business process, it’s better to have one single standard procedure of depositing (not cashing, ha) every check right away. Rather than asking any person handling a check to go through some sort of decision tree on the spot.

If you need to return the money later you can always cut your own check.

If you deposit a check for which you have no receivable or sale, what entry do you make in the accounting system?

You use a suspense account.

It is typical in the health insurance billing world where the check is sent separately from the explanation of benefits which details how they are paying for everything. You may get a random check in the mail that is paying for claims described in a separate letter or fax you received weeks earlier.

Or later! As a patient I've received both payments from insurance providers and overpayment reimbursements from medical providers before the explanation of what the check is for. Usually just a day or two if that, but if something gets missed and has to go through a reconciliation process I could easily see that EOB letter going out a month or more later.

It's corporations dealing with a private person though, they don't care.

Because the people with letter openers in the mail room aren’t accountants?

Right, they open the mail and give the check to the accountant, who deposited it.

And we still want to know why.

Cashflow and Revenue are two separate concepts.

You can cash a check today for revenue you accounted for 90 days ago.

You need to reconcile it but it doesn't have to happen at the same time. It's very normal to reconcile months later.

The minimum wage employee who stamps the check and deposits it at the bank with the hundred others in the pile isn't an accountant either.

The accountants just go "huh, this one doesn't match up with anything" later on.

> The minimum wage employee who stamps the check and deposits it at the bank with the hundred others in the pile isn't an accountant either.

That’s not how any of this works lol

It is exactly how all of this works

In Canada, one of the main players in the space is INTRIA

https://www.cibc.com/en/cibc-websites/intria.html

They have an office full of people processing cheques, cash etc etc. In the old world, all cheques were processed by hand but in the new world, all cheques are processed by a combination of electronic imaging and MICR: people only look at the ones where tech processes fails. Which are a lot of them.

This area of finance is called "Corporate Cash Management" - a bit of misnomer because it is not just cash and is primarily electronic these days. It is essentially about the processes that need to be in place to physically and electronically move money around.

Here are some examples of what the biggest bank in Canada offers in this space.

https://www.rbcroyalbank.com/business/paying-and-receiving/m...

The do not explicitly mention cheques because that space is really well automated these days but it is mostly done really well by technology and most banks are trying to move away to electronic payments. But if you ask for it, you will get it at specially quoted per customer rates.

Nice article on declining cheque usage in Canada: https://www.bankofcanadamuseum.ca/2023/09/a-checkup-on-chequ...

> That’s not how any of this works lol

How does it work?

Probably, they open the mail and send checks directly to the bank. Then the bank sends the deposit information to the accountants.

They certainly have all kind of strange things they must send to all kinds of people.

AKA a suspense account (in this case tied to the sender). “I have money from this entity but I don’t yet know why”.

sometimes the eob (explanation of benefits) would eventually show up but it would have no check number to tie it back to the payment. It would also span checks so you really had no way to tie what payment went to what prescription. You just had a pile of money and a pile of billed prescriptions. AR reconciliation, trying to figure out who paid for what and how much you're owed and how old it is, was a dark art and the code had all kind of tweaks for specific payers accommodating for all their payment inconsistencies. Some payers met the terms of the contract, some didn't, some had bugs where they'd over/under pay $1 in certain circumstances etc. It was a mess, i'd tell the payers to fix their system but they'd just blow me off (I was pretty naive at the time). Interestingly, i could tell when multiple payers leased the same system because there would be strange bugs consistent across payers. That $1 over/under payment sticks out in my mind 25 years later.

I wonder if you billed other entities (people?), and those bubbled to insurance carriers, meanwhile you left the accounts of those people in debt because no one cared to follow it back - call it magic money and leave the debt on people's accounts anyway?