Under the revised Article 9, we are required to terminate the UCC on consumer goods when the debt is satisfied. What is the definition of consumer goods?
Question: One of our officers attended your workshop in Philadelphia and came back and said we should stop checking endorsements on the checks that come in through the exchange.
I understand that a customer has 30 days from statement date to notify bank of any discrepancies, however a payer bank only has 24 hours to notify a depository bank of fraudulent items. Scenario: My bank is presented an item and it clears my customer's account, then a week later my customer calls and says they did not write the check and the signature must have been forged. The 24 hour reclamation period has expired but according to UCC 4-406 the customer notified me in a reasonable amount of time. What action can I take to receive credit for the item or do we credit the customer and take a loss?
A customer cashed a Cashier's Check which turned out to be counterfeit. Now they don't want to pay us back. They say that UCC law makes the bank liable. The bank's deposit agreement states that any item returned unpaid even if the item was cashed can be charged back to the customers account. Who is right?
Is it my imagination, or is the financial industry becoming more mercenary and considerably more paranoid than it used to be?
How long are you required to retain records regarding forgeries?
by Barbara Hurst, Editor, BANKERS' HOTLINE
A customer’s business was burglarized and as one might imagine the office was a mess. When the police arrived, they had her check everything to evaluate if anything was missing. The customer checked her locked desk drawer for her current checkbook and locked cabinet for her other checkbooks that had not yet been written from. The customer did not notice that any of the business’ checks were missing, and the contents of the cabinet appeared to be untouched. The burglars apparently found her keys, removed a checkbook and relocked the cabinet because one book of checks was in fact missing. Eight checks were forged and cashed to the tune of $10,139. Of the eight checks, one was cashed at our institution for under $500 in the drive-up (we did not check the signature per our internal policy for drive-up transactions) and the others for $1200- $1500 were cashed at other institutions on the suspect’s account. The suspect(s) have since fled the state and are presumed to be on their way out of the country with our customer’s cash as well as that of other fraudulent checks. This customer did not notify our institution about the break-in, or the missing checks until her statement came out 13 days later, well after the checks had been cashed and cleared her account. Our question is: what portion of this loss belongs to our customer, and what portion belongs to our institution? Did the customer exercise ordinary or reasonable care when she looked at the items in her locked cabinet and didn’t notice that one book of checks was missing? Who takes the loss?
We suspect account owner may be involved in a forged check scam. How soon are we required to refund upon submission of forgery affidavit?
Question: We attended your Workshop in Philadelphia, where the attorney talked about ambiguously named payees - where there is no "and" or "or," the new UCC says in that case it's