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Can you summarize 12A OKST 4-406?
Relationship Between Payor Bank and Its Customer > Customer's Duty to Discover and Report Unauthorized Signature or Alteration
Short Summary
This legal document governs the duty of bank customers to discover and report unauthorized signatures or alterations. It applies to customers of banks. The document states that when a bank sends or makes available a statement of account showing payment of items, the customer must either return or make available the paid items or provide sufficient information in the statement to allow the customer to identify the items paid. If the items are not returned, the person retaining them must either retain them or maintain the capacity to furnish legible copies for seven years. The customer must exercise reasonable promptness in examining the statement or items to determine unauthorized payments and promptly notify the bank if unauthorized payments are discovered. If the customer fails to comply with these duties and the bank proves that it suffered a loss, the customer is precluded from asserting unauthorized signatures or alterations against the bank. The document also addresses the allocation of loss between the customer and the bank if the bank failed to exercise ordinary care. Additionally, it establishes a one-year limitation period for discovering and reporting unauthorized signatures or alterations. If the customer fails to report within this period, they are precluded from asserting unauthorized signatures or alterations against the bank.
Whom does it apply to?
Bank customers
What does it govern?
Customer's Duty to Discover and Report Unauthorized Signature or Alteration
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
No specific penalties are mentioned.
Jurisdiction
Oklahoma