The Brechers owned Contractors Source, which had a company account at Amegy Bank. Straten was a bookkeeper for Contractors. She stole money by forging check over 32 months. Amegy agreed that the checks were forgeries but argued that the terms of the account agreement said that forgeries must be reported within 30 days, so it was not responsible for most forgeries, as it had sent monthly statements that had not been checked. Under the UCC, is Amegy correct?
A) No, banks are responsible for all forgeries when the signature does not match the authentic signature on file.
B) No, banks are responsible for all forgeries that occur "in the normal course of business" as was true here.
C) Yes, it paid the checks in good faith and could not reasonably be expected to compare signatures on all checks.
D) Yes, it sent monthly statements, so the Brechers should have looked for problems.
E) None of the other answers are correct.
Correct Answer:
Verified
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