Truncating Bank Law and Legal Definition
According to 12 CFR 229.2 [Title 12 -- Banks And Banking; Chapter Ii -- Federal Reserve System; Subchapter A -- Board Of Governors Of The Federal Reserve System; Part 229 -- Availability Of Funds And Collection Of Checks (Regulation Cc); Subpart A – General] truncating bank means –
“(1) The bank that truncates the original check; or
(2) If a person other than a bank truncates the original check, the first bank that transfers, presents, or returns, in lieu of such original check, a substitute check or, by agreement with the recipient, information relating to the original check (including data taken from the MICR line of the original check or an electronic image of the original check), whether with or without the subsequent delivery of the original check.”
