New York State is one of the few states (S.C. being the other) that has not adopted the revisions to the UCC from 1990. These revisions give we Banks greater leeway on denying claims regarding forged checks, in that the customer could be held liable for negligence in not protecting their checks. Does anyone know if the revised UCC is before the N.Y. State Senate, and if it will ever be adopted? See below:

Historically, the banking community has primarily been held liable for their clients' check fraud losses. This is no longer the case. In 1990, the Uniform Commercial Code (UCC) was revised. Sections 3 and 4 have shifted liability for check fraud losses from the bank to the party in the best position to prevent the loss. Forty-eight states have adopted these revisions, with New York and South Carolina being the two exceptions.

What does this mean to you? There is now a legal basis and financial incentive for a company or municipality to be more aggressive in implementing procedures and controls to reduce its risk of check fraud. As check fraud losses have skyrocketed over the past few years, banks are much less willing to accept losses for the sake of the banking relationship. The revised UCC provides a legal basis for the banks to leave the check fraud loss with their customer, even if it means losing the customer. (See BusinessWeek, August 13, 2001, page 70.)"