Exam 27: Bank Deposits, Collections, and Funds Transferspart Vi: Agency

If a depositor in First Bank takes a check written on Valley Bank to First Bank to deposit, it will not normally be credited to his account until collected from the payor bank.

Article 4 of the UCC, entitled "Bank Deposits and Collections" provides the principal rules governing bank collection practices.

If Margie makes out a check for $27.50 when she has only $10 in her account, her bank may:

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

Alvero tries to make a $75 withdrawal from an ATM, but the terminal has run out of cash.The bank is liable to Alvero for damages proximately caused by its failure to make the EFT.

Goble, the seller, obtains authority from Meigs, the buyer, to debit Meigs's account after Goble ships the goods.Article 4A covers this transaction.

A bank may pay a check after the death of its customer for ten days following the date of his death unless a person claiming an interest in the account orders the bank to stop making such payments.

Under the Competitive Equality Banking Act, a nonlocal check must clear in no more than four intervening business days.

A check drawn on a bank is an order to pay a sum of money and an authorization to charge the amount to the drawer's account.The drawer may countermand this order by which of the following?

If Ben Stewart has a checking account at First Bank:

A payor bank is under no obligation to its customer to pay an uncertified check that is more than six months old.

Any unauthorized indorsement must be asserted within one year under the UCC's statute of limitations provision.

Which of the following is true of a collecting bank?

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?

Under Revised Article 4, if a bank pays a postdated instrument prior to its date, it will be a proper debit to the drawer's account, unless the drawer had timely informed the drawee that the check was postdated.

The Check Clearing for the 21st Century Act requires banks to accept checks in electronic form.

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

A provisional credit occurs at the time a depositary bank permits a customer to draw funds against the deposited check.

For how long is a written stop payment order valid?

The Electronic Funds Transfer Act governs electronic transfers between financial institutions, between financial institutions and businesses, and between businesses.