Exam 31: Checks and Funds Transfers

A written stop payment order or confirmation is effective for:

A forged indorsement must be reported within:

In the case of either a check or a draft,the drawer may be held civilly liable if the instrument is dishonored.

The Electronic Fund Transfers Act (EFTA)does not cover transactions originated by commercial paper.

The EFTA is concerned with the:

When a bank certifies a check,the amount involved in the certification will be retained in the depositor's account until payment of the certified check.

If a bank pays a check whose face has been altered to increase the amount above that which the drawer intended to pay,the bank:

An "encryption" warranty is a warranty made by any party who encodes electronic information on an instrument.

A forged endorsement must be reported within one year of the time that the bank statement is received.

A bank's customer whose signature has been forged may be barred from holding the bank liable if the customer's negligence substantially contributed to the making of the forgery.

A debit transaction occurs when a person making a payment requests such payment be made to the beneficiary's bank.

A notice of dishonor may be oral,written or electronic.

A buyer may stop payment on a certified check issued to a seller if the goods are defective when received.

Ordinarily,the drawee bank is liable to the drawer when it pays a check on which the drawer's signature has been forged.

A depositor issued a check and,after mailing the check,suffered a heart attack and died.In the regular course of business,the bank paid the check when presented for payment,despite the fact that the bank had received notice fourteen (14)days earlier of the depositor's death.In terms of the bank's payment of the check

A bank will not be liable for payment of a check on which the drawer's signature has been forged if:

Sondra realized on Tuesday that she had dropped her bank EFT card after using it at an automatic teller machine.She telephoned the bank on the following Monday to notify it of the loss.By that time,someone had used the card to withdraw $800 from Sondra's account.The bank said it would cover $300 of that amount.Sondra sued for the full amount,claiming that she had exercised reasonable care in reporting the loss,especially because the card was lost on bank premises.Will she be able to recover the full $800?

A thief stole Art's checkbook and forged Art's name as drawer of a check.The drawee paid the check in good faith and sent it to Art with the monthly statement on January 3,2013.The thief forged other checks during February and March of 2013,which the drawee in good faith paid.All paid checks were sent to Art with monthly statements.On May 25,2014,Art discovered all of the forgeries and notified the drawee.For which check(s)is Art entitled to be reimbursed?

Funds transfers made by businesses are governed by __________ regulations.

A bank always is liable to the depositor on a counterfeit check that the bank has paid.