I live abroad and work with US firms paying me in private checks drawn from US banks. I was told that i am at risk, as even if i deposit the check in my account, US law allows the check to bounce or get cancelled up to 5 years after issue. In this case my bank has to pay the money back to the issuing bank, and takes it out of my account.
Is this true?
1.Can somebody just decide to cancel all checks they issued to me for the last 5 years, and force me to pay everything back, or do they have to give a valid reason (there should be no such reason, as i get paid only after i do the work to the firms' full satisfaction)?
2.Is a legal procedure involved and can i defend myself? Is it easy or hard to cancel checks?
3.If the firm that pays me gets into financial problems and owes their bank money, can their bank decide to reclaim all the checks paid to me?
4.Is there anything i can do to defend myself against such cases, making the payment final?
I would appreciate your answers
Andy