Answer:
Answer by Randy Carey:This would depend on what has been forged, i.e., the maker's signature or the payee's signature. You need to refer to your state's UCC for determination.
Answer:
Answer by John Burnett:If it was your depositor's signature that was forged on a check that you paid, the deadline was midnight of the business day following the business day the check was presented for payment. That's a UCC requirement.
If your bank and the depositary bank both belong to the same check clearing house, and the clearing house has a warranty rule saying that the depositary bank warrants that it will repay a participating paying bank for a fraudulent check under limited circumstances, that might allow you to make a warranty claim to shift the loss or part of it to the depositary bank even though you missed the UCC midnight deadline. Typically, these check fraud warranty rules provide limited protection if the funds are still on deposit at the depositary bank; otherwise, your bank is liable. Whether or not your bank is liable to your depositor for paying the check largely depends on section 4-406 of the UCC in your state, and applicable provisions of your deposit contract.
First published on BankersOnline.com 10/25/10
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