Asked by Bryan Velasquez Beltran on May 10, 2024
Verified
Assuming the bank is not negligent, in the case of multiple forgeries by the same wrongdoer, what is the effect of a customer's failure to notify the bank of the first forgery in regard to subsequent forgeries?
A) There is no effect because each forgery stands on its own.
B) The customer is barred from recovering on the subsequent forgeries.
C) The customer may recover on a subsequent forgery if it is reported to the bank within 5 days after the statement showing the subsequent forgery is received by the customer.
D) The customer may recover on a subsequent forgery if it is reported to the bank within 10 days after the statement showing the subsequent forgery is received by the customer.
E) The customer may recover on a subsequent forgery if it is reported to the bank within 15 days after the statement showing the subsequent forgery is received by the customer.
Multiple Forgeries
Acts of fraudulently making or altering multiple written documents or signatures to deceive others.
Negligence
A failure to act with the level of care that someone of ordinary prudence would have exercised under the same circumstances, resulting in harm or damage.
- Understand the legal consequences associated with actions such as fraud, forgery, and unauthorized transactions in the banking sector.
- Identify the legislation that safeguards consumers in banking transactions and electronic fund transfers.
Verified Answer
NS
Nancy SachdevMay 16, 2024
Final Answer :
B
Explanation :
The customer is barred from recovering on the subsequent forgeries because the failure to notify the bank of the first forgery generally precludes the customer from claiming losses from any subsequent forgeries by the same wrongdoer, assuming the bank was not negligent. This is based on the principle that the customer's notification could have prevented further forgeries by the same individual.
Learning Objectives
- Understand the legal consequences associated with actions such as fraud, forgery, and unauthorized transactions in the banking sector.
- Identify the legislation that safeguards consumers in banking transactions and electronic fund transfers.
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