Our former customer (since closed) made a deposit through another bank's ATM in 2004. The other bank passed the credit along to us through our ATM network, but our bank never actually handled the check.
The other bank has since received the check back for forged payee endorsement. Of course, the other bank wants to collect from us since our customer made the deposit and the credit was passed along to us through the ATM network.
I beleive this is just the risk the other bank takes for letting customers of other banks deposit through its ATM's. The other bank served as bank of first deposit and is therefore responsible for presentment warranties. We never handled the check, and, therefore, were never in a position to prevent the fraud.
Isn't this an issue under UCC of who was in the best position to prevent the fraud, not who may be in a better position to collect on it after the fact?