Faye forges Greta's signature on a check "payable to the order of Faye" drawn on Greta's account in Home Bank. Most likely, if the bank pays the check
A) the Federal Reserve will reimburse all parties for their costs.
B) the loss will be apportioned among all of the bank's customers.
C) Greta will be liable for the amount.
D) the bank will have to recredit Greta's account.

Question

Quizplus · Accepted Answer

The bank is responsible for verifying signatures on checks. If it pays a check with a forged signature, it must recredit the account of the person whose signature was forged.

Faye Forges Greta's Signature on a Check "Payable to the Order