Exam 29: Bank Deposits,collections,and Funds Transfers

First Bank pays a forged check on Donald's account.Donald finds it when,the day he receives it,he is examining his bank statement.He brings it to the bank the next day,but they refuse to credit his account.The bank has an obligation to recredit Donald's account.

An association of banks created for the purpose of settling accounts with each other on a daily basis is a:

If a bank pays on a check even though it has a "stop payment order," it is liable to the customer only if the customer can prove a loss because of the payment.

A payment order:

The fact that a drawer has filed a stop payment order automatically relieves the drawer of liability on the underlying obligation.

Each provisional settlement made in the collection chain is made final when the next bank takes the check.

If a checking account customer's funds are insufficient to pay all of the items that the bank receives on that account on a given day,the bank may charge the items against the account in any order the bank deems convenient without incurring liability to the customer/drawer for choosing one item over another.

Lois takes her paycheck to Third National Bank for deposit at 6 p.m.on Wednesday.Third National Bank has until when to forward the check?

A financial institution is liable to its customer if an electronic terminal has insufficient cash for a withdrawal of up to $100.

What is electronic funds transfer? Why do banks like it? What provisions are in the law to protect the customer who uses electronic funds transfer?

Banks may not pay checks issued by a customer who has died.

Which of the following is true with regard to the federal Electronic Fund Transfer Act?

For how long is an oral stop payment order valid?

Which of the following is NOT a duty that a collecting bank has in the collection process?

Which of the following is correct with respect to a bank customer's duty to discover and report unauthorized signatures?

A payor bank is is required to pay an uncertified check even if it is nine months old.

Caryn deposits a check in her bank at 2:30 on Monday.The bank may,under the Code,treat the check as having been deposited on Tuesday for purposes of meeting the midnight deadline rule.

ABC Bank sent Joanne,a depositor,her January statement on January 31.Within what length of time after this date will Joanne have to examine the statement and enclosed items and notify ABC bank of any errors?

Banking and the collection process of checks is governed solely by state law.

If Valley Bank pays a check over a stop payment order of one of its customers,Valley Bank is subrogated to the rights of: