Question 1

Smith & Jones Associates is a business customer of Superior Bank.Under federal law,Smith & Jones cannot demand

Accepted Answer

Under federal law, business customers like Smith & Jones cannot demand the return of their original checks with their monthly statements.

Question 2

On Monday,Michelle deposits in her account at Fiscal Bank a local check for $500.After 5:00 p.m.on Friday,from these funds,Michelle can withdraw no more than

Accepted Answer

The answer of On Monday,Michelle deposits in her account at...

Question 3

Paris knowingly divulges to Media Exposure magazine information about Randy's e-money payments to City Bank.The payments were in trans?mission to City Bank when Paris,without the consent of Randy or City Bank,discovered and revealed them.This may be a violation of

Accepted Answer

The answer of Paris knowingly divulges to Media Exposure magazine...

Question 4

Hoppy steals two checks from Eagle Retail Stores,Inc.-a blank check and a check payable to the order of General Supplies Company (GSC),drawn on Eagle's account with First National Bank.Hoppy forges Eagle's signa?ture on the blank check and makes it payable to himself.Hoppy forges GSC's indorsement on the back of the check payable to GSC,and adds "Pay to the order of Hoppy." At Friendly Credit,Inc.,Hoppy indorses the back of both checks with his own name and gives them to Friendly for cash.Friendly does not know about the theft or the forged signatures and presents the checks to First National,which pays them.Eagle,which was not negli?gent,discovers the forgeries and asks First National to recredit its ac?count.Who suffers the loss on each check?

Accepted Answer

The answer of Hoppy steals two checks from Eagle Retail...

Question 5

E-Bank,an online financial institution,gives financial information about Paula and other customers to a federal agency without the cus?tomers' permission.E-Bank may be liable under

Accepted Answer

The Right to Financial Privacy Act protects the privacy of customers of financial institutions by requiring institutions to obtain a customer's consent before disclosing their financial information to a government agency. Therefore, E-Bank may be liable under this act for disclosing Paula's financial information without her consent.

Question 6

Guaranty Bank receives a check drawn on the account of Get-Rich Industries,Inc.,one of the bank's customers,at 3 p.m.Friday.Garry,the pre?senter of the check,is not one of the bank's customers.The bank uses de?ferred posting with a 2 p.m.cutoff hour.If it decides to dis?honor the check,it must do so by midnight

Accepted Answer

The answer of Guaranty Bank receives a check drawn on...

Question 7

Joy steals a check from Kyle,forges his signature,and transfers the check to Loco Loans,Inc.,for value.Unaware that the signature is not Kyle's,Loco Loans presents the check to Metro Bank,the drawee,which cashes the check.Kyle discovers the forgery and insists that Metro recredit his account.Can Metro refuse? If not,from whom can the bank recover?

Accepted Answer

The answer of Joy steals a check from Kyle,forges his...

Question 8

Jackie inserts a debit card issued by her bank into a machine and keys in her personal identification number.She is then able to withdraw $500 in cash.Jackie is using a

Accepted Answer

Jackie used a debit card and a PIN to withdraw cash, which can only be done at an automated teller machine (ATM). A point-of-sale system is used to make purchases at a store or merchant, not to withdraw cash. Direct deposit is when funds are automatically deposited into a bank account, and an internet payment system is used to make online payments, neither of which apply in this scenario.

Question 9

Clyde issues a check payable to Discount Mart.Elle,Discount's cashier,forges the store's indorsement and deposits the check in her bank ac?count.Clyde's bank,First State Bank,pays the check.Clyde can recover from

Accepted Answer

As the check was forged, the indorsement is not valid and therefore, First State Bank can recover the amount paid from Elle who deposited the check. Clyde can also recover the amount from Elle as she is responsible for the fraudulent act of forging the indorsement.

Question 10

Fact Pattern 25-2 (Questions 27-28 apply)
Tom draws a check,on his account in State Bank in New York,payable to Digital Media,Inc.,in San Francisco.Digital deposits the check in its ac?count at First National Bank.
-Refer to Fact Pattern 25-2.Tom's bank is

Accepted Answer

Tom's bank is the payor bank because it is the bank on which the check is drawn and is responsible for paying the check.

Question 11

Best Banking Bank creates a paper reproduction of customer Sophie's check with the statement "This is a legal copy of your check.You can use it in the same way you would use the original check." This is a

Accepted Answer

The given scenario is describing a substitute check, which is essentially a paper reproduction of an original check that includes all the necessary information and can be used in the same way as the original check. Certified checks are checks that the bank guarantees the funds for, cashier's checks are issued by the bank and drawn on the bank's funds, and void checks are cancelled and no longer valid for use. Therefore, the best choice is C - substitute check.

Question 12

Fact Pattern 25-2 (Questions 27-28 apply)
Tom draws a check,on his account in State Bank in New York,payable to Digital Media,Inc.,in San Francisco.Digital deposits the check in its ac?count at First National Bank.
-Refer to Fact Pattern 25-2. Digital's bank is

Accepted Answer

Digital's bank, First National Bank, is the depositary bank because it received the deposit of the check.

Quiz 25: Checks and Banking in the Digital Age