Tenth National Bank extended a $2 million loan to ABC Development Company.Tenth National accepted a mortgage on a building as collateral for the loan.The mortgagee's signature on the loan,however,was a forgery.The resulting loss is covered by which financial institution bond coverage?

Question

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Insuring Agreement G-Fraudulent Mortgages specifically covers losses resulting from accepting fraudulent mortgages as collateral. In this scenario, the mortgagee's signature was forged, making the mortgage fraudulent.

Tenth National Bank Extended a $2 Million Loan to ABC