CAM Payment Recovery Update: June 2023
DisclaimerThis information is intended to provide an overview of the process under Payments Canada Rules, to which RBC are signatory. This is not legal or financial advice. Following the steps described does not guarantee that funds will be returned in any given situation. Payment under the process outlined below is dependant on the individual cheque at issue and will vary depending on the specific situation.
The following general information regarding the cheque return process emerged from discussions between ACTRA Toronto and RBC, the former bank of record for Compass Artist Management.
The information below is intended to outline the process to be followed by a member seeking a potential return of funds.
A person disputing a cheque on the basis of “Intended Payee(s) Not Paid”, must coordinate with the issuer of the cheque to complete and sign a Declaration form established by Payments Canada Rules (see the attached Declaration form currently available on the Payments Canada website). The issuer then must have its own bank submit the completed documentation to the financial institution where the cheque at issue was initially deposited (known as the “negotiating institution” or “collecting bank”).
In order to commence the process to have a cheque returned, therefore, an individual performer must coordinate with the issuer (e.g. Production Company, Payroll Company) and then the issuer’s bank (known as the “drawee bank”). The drawee bank may require the submission of relevant documentation.
The negotiating institution/collecting bank will then review the information provided by the drawee bank to determine whether the return is justifiable under the applicable cheque clearing rules set by Payments Canada. The decision on return/no return is dependent on the individual cheque at issue.
If the negotiating institution determines that the completed documentation establishes a valid claim, it may send funds (representing the face value of the cheque) back to the issuer’s bank (drawee bank). It will then be up to the original issuer of the cheque to decide if/when/how a replacement payment will be made. A cheque return decision can only be made by a financial institution after an individual cheque is reviewed against all of the circumstances.
For clarity, as provided by RBC to ACTRA Toronto, if cheques read “In care of” or “In trust of”, a return may not be processed because the intended payee received the funds.
RBC will continue to investigate all claims brought forward, case-by-case, but we wanted to ensure that expectations are clear and that you have been advised accordingly. This is a case-by-case assessment. The information contained herein outlines the general process for commencing a cheque return claim and decision. The individual actor’s personal financial institution has no bearing on this process.
While we know that this is not the update that performers represented by CAM were hoping for, ACTRA Toronto will attempt to work with issuers that are IPA signatory Producers to encourage their cooperation with the cheque return process and to assist them as much as possible as they do so.