Exam 25: Checks and Banking in the Digital Age

Guaranty Bank receives a check drawn on the account of Get-Rich Industries,Inc.,one of the bank's customers,at 3 p.m.Friday.Garry,the presenter of the check,is not one of the bank's customers.The bank uses deferred posting with a 2 p.m.cutoff hour.If it decides to dishonor the check,it must do so by midnight​ 

The rights and duties of a bank and its customer are contractual. 

Del signs a check "pay to the order of Eppie" drawn on Del's account in First Federal Bank.Greta forges Eppie's indorsement.First Federal pays the check.Most likely​ 

Today,most checks are processed manually. 

Cleo writes a check for $100 drawn on Debit & Credit Bank and presents it to Elegant Jewelers for payment.If the check is not backed by sufficient funds,Cleo may be prosecuted for​ 

Elton presents an uncertified check for payment more than six months after its date.The check was drawn by Dakota on her account in First Community Bank.The usual banking practice in such a case is to​ 

O'Shea issues a check drawn on Prime Bank to Quality Equipment Supply to pay for a backhoe.Later,O'Shea discovers a defect in the backhoe and orders the bank to stop payment on the check.O'Shea does not renew the order,and the bank clears the check eight months later.The bank​ 

The incompetence of a customer revokes a bank's authority to pay an item. 

Smart cards carry and process security programming. 

Fact Pattern 25-1Marlene loses her Neighborly Bank access card. She realizes her loss the next day but waits a week to call the bank. Meanwhile, Odell finds and uses Marlene's card to withdraw $3,000 from Marlene's account. -Refer to Fact Pattern 25-1.Marlene is responsible for​ 

A written stop payment order is only valid for thirty days. 

A check that is presented for payment more than six months from its date is a stale check. 

Clyde issues a check payable to Discount Mart.Emma,Discount's cashier,forges the store's indorsement and deposits the check in her bank ac-count.Clyde's bank,First State Bank,pays the check.Clyde can recover from​ 

When a bank draws a check on itself,the check is called a cashier's check. 

Ian buys a cell phone in Jiffy Mart,using the means that accounts for more retail payments than any other.This means of payment is 

Amelia writes a check to Barry on her account at Community Savings Bank.The bank dishonors the check even though Amelia has sufficient funds in her ac-count.The bank is 

A forged signature is effective as the signature of a drawer to the extent that is resembles the drawer's actual signature. 

Brendan signs a check "pay to the order of City College Bookstore" drawn on his account in Delta Bank to pay for his current semester's textbooks.The bookstore deposits the check in its account in Eagle Bank.Like most checks,this check is​ 

Simon signs a check "pay to the order of Tilly" drawn on Simon's account in United Bank.Vela forges Tilly's indorsement,First Federal Bank cashes the check,and Vela disappears.United pays First Federal and debits Simon's account.Most likely,the ultimate loss will fall on​ 

A drawer is liable to the holder of a check in a civil suit if the check is dishonored for insufficient funds.