Cashier's checks deposited into a bank account are usually cleared the next day. The customer can request "next-day availability" when depositing a cashier's check in person.
When cashier’s checks took weeks to clear the banks they were often forged in fraud schemes. The recipient of the check would deposit it in their account and withdraw funds under next-day availability, assuming it was legitimate. The bank might not be informed the check was fraudulent until, perhaps, weeks after the customer had withdrawn funds made available by the fraudulent deposit, by which time the customer would be legally liable for the cash already withdrawn.
A customer asks a bank for a cashier's check, and the bank debits the amount from the customer's account immediately, and assumes the responsibility for covering the cashier's check. That is in contrast with a personal check, in which the bank does not debit the amount from the customer's account until the check is deposited or cashed by the recipient.
A cashier's check is not the same as a teller's check, also known as a banker's draft, which is a check provided to a customer of a bank or acquired from a bank for remittance purposes and drawn by the bank, and drawn on another bank or payable through or at a bank. A cashier's check is also different from a certified check, which is a personal check written by the customer and drawn on the customer's account, on which the bank certifies that the signature is genuine and that the customer has sufficient funds in the account to cover the check. Also, it should not be confused with a counter check, which is a non-personalized check provided by the bank for the convenience of a customer in making withdrawals or payments but is not guaranteed and is functionally equivalent to a personal check.
Cashier's checks feature the name of the issuing bank in a prominent location, usually the upper left-hand corner or upper centre of the check. In addition, they are generally produced with enhanced security features, including watermarks, security thread, color-shifting ink, and special bond paper. These are designed to decrease the vulnerability to counterfeit items. To be recognized as a cashier's check, words to that effect must be included in a prominent place on the front of the item.
The payee's name, the written and numeric amount to be tendered, the remitter's information, and other tracking information (such as the branch of issue), are printed on the front of the check. The check is generally signed by one or two bank employees or officers; however, some banks issue cashier's checks featuring a facsimile signature of the bank's chief executive officer or other senior official.
Some banks contract out the maintenance of their cashier's check accounts and check issuing. One leading contractor is Integrated Payment Systems, which issues cashier's checks and coordinates redemption of the items for many banks, in addition to issuing money orders and other payment instruments. In theory, checks issued by a financial institution but drawn on another institution, as is often the case with credit unions, are teller's checks.