The Effect of the Fictitious Payee Rule Is That

Multiple Choice

The effect of the fictitious payee rule is that:

A) fictitious payees are entitled to collect on instruments.
B) the maker or drawer will be liable for payment of an instrument naming a fictitious payee.
C) makers and drawers are protected from liability resulting from paying an instrument naming a fictitious payee.
D) parties forging the signature of a fictitious payee can be liable for losses incurred by the forgery.
E) banks are required to positively identify any holder seeking payment at the bank on an instrument.