The rationale for the impostor rule is that the responsibility for determining the true identity of the payee:
A)is shared by the bank and the maker of the negotiable instrument.
B)is on the drawer or maker of the negotiable instrument.
C)is on the bank that negotiates the instrument.
D)is on the payee whose name is mentioned in the negotiable instrument.

Question

Quizplus · Accepted Answer

The rationale for the impostor rule is to put the responsibility for determining the true identity of the payee on the drawer or maker of a negotiable instrument.The drawer is in a better position to do this than some later holder of the check who may be entirely innocent.

The Rationale for the Impostor Rule Is That the Responsibility