I'm sorry, in the wonderous new days of the Check 21 law, which took effect October, 2004 and allows much more rapid payment of items customers use to pay their bills, there is no excuse for this delay.
Either a cashier's check is fraudulent or counterfeit, or it is good and backed by the full faith and credit of an FDIC insured bank.
Admittedly, there are two different risks involved, the risk of a check not being backed by sufficient funds (essentially zero in the case of a cashier's check, but significant in the case of a personal check), and the risk of a check being fraudulent (presumably higher in the case of a large dollar amount check). One wants a cashier's check to protect you against the former, but it still doesn't protect you from the latter.
But, delay, for any reason, defeats an important objective of the customer in a good funds transaction, which is prompt fund availability. A wire transfer can resolve this problem, but it shouldn't be the only option.
Now, most checks are small. Only 3% of checks are written for more than $5,000, and just 1.7% are for more than $10,000. About 8.5 per 1,000 checks are returned, but these too are usually small, with an average value of$700. I suspect that cashier's checks have much higher average values, but really big transactions (in part because of the structure of existing funds availability regulations) are done by wire, so they are probably not that much higher.
Check fraud is common enough, but it is hard to determine how much of it involves special checks that are considered good funds.
Eight in 10 banks (80 percent) incurred check fraud losses in 2006, up from 75 percent in 2003.
The total amount of attempted check fraud against banks' deposit accounts reached an estimated $12.2 billion in 2006. Most of the attempts (92 percent) were caught by banks' prevention systems or measures before incurring any financial loss to the bank.
On average, 44 percent of a community bank's 2006 check fraud losses could be attributed to organized customer scams. The percentage decreased to 14 percent at the largest banks.
One of the best statistics to break down the nature of payment system frauds comes from the database of suspicious activity reports filed by banks. In the year 2002, for example, there were 4,747 reports of wire transfer fraud, 3,741 instances of debit card fraud, 12,780 instances of credit card fraud, 12,575 instances of counterfeit checks, 1,246 instances of counterfeit credit or debit cards, 791 instances of other counterfeit instruments, 9,561 instances of check kiting, and 32,954 instances of check fraud that were reported.
There are about 40 billion checks written per year, compared to on the order of 100 million wire transfers (the average amount is about $4 million, although 25% of them are for less than $100,000). Statistics aren't easily available to determine the percentage of checks in the banking system that rely on the credit of the bank, rather than a personal bank account, but it is probably not more than 1-2% of all checks, and is probably comparable to the number of wire transfers.
The number of counterfeit cashier's check each year is probably on the order of two or three thousand, so the counterfeit check rate is on the order of less than one per thousand transactions, less than 10% of the risk involved in a typical personal check. Indeed, it seems likely that cashier's checks may actually involve less fraud risk than wire transfers.
All of this data taken together suggeests that some form of express processing for high dollar (over $5,000) cashier's checks (and comparable instruments like certified checks) should be designed in order to better balance the consumer expectation that cashier's checks are good funds comparable to cash, and in order to reflect the relative costs of delay in access to funds vis-a-vis costs of fraud. Large cashier's check transactions are rare enough that special handling to reduce the status quo nine day delay in handling these transactions is justified. Most of the risk could be eliminated simply by confirming customer identification against a third party database, and confirming the check's issuance with the issuing bank, something that could be accomplished in minutes with the proper systems in place, which banks could easily do with reform of funds availability and cashier's check clearing regulations.