Fraud and FedNow payments

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Question:

We are considering allowing customers to use FedNow to receive instant wires. The concern is our customer receives the wire and spends the funds and a day, two, or more go by and we receive a claim to return the funds due to fraud. Which bank would have liability for a fraudulent wire transfer, the sending bank or the receiving bank? Can you provide the references that I should be looking into (UCC, Regulations, etc.)?

Answer:

Have you read the Operating Procedures. If not, you should and pay attention to Page 53.

https://www.frbservices.org/binaries/content/assets/crsocms/resources/ru...