An additional warning, a bank can clear a cheque within three days but
will still remove the money from your account is the cheque is
subsequently found to be fraudulent. There is no time limit for this,
it can be a month later or a year later.
Don't ask me why it's not the banks fault for clearing a dodgy cheque
in the first place, but it isn't.

So I don't really know what the answer is to be honest? It seems a
cleared
cheque is no guarantee of payment - so is a genuine banker's draft the
only
way?

Yep, a cheque can be cancelled up to 6 months after it's date I think,
even if it has cleared into the payee's account. For example, you are
paying for something you've bought on ebay and you send a cheque. The
seller then pays the cheque in and the money clears out of your
account. A month later you still have not received your item, and the
seller isn't answering your emails. You can instruct your bank that
the transaction was fraudulent and they can cancel the cheque. The
money is then returned to your account. I think you have to have a
pretty good reason (ie fraud) for cancelling the cheque though.

But surely if person A writes a cheque out to person B, who then pays it in
and waits until the funds are cleared before spending the money, and person
A's bank then cancels the cheque months later due to funds not being
available, then it isn't within the bank's rights to turn the debt owed by
person A to their bank into a debt owed by person B to their bank? Pretty
****ed up system if you ask me. Makes you wary about ever accepting cheques
at all.

Peter