Legal Question in Banking Law in Montana

Endorsements

We have a depositor ''A''. He operates a small farm under a business name. Recently, we noticed that all of his deposit, both personal and business, are being deposited to his girl friend's account, without her endorsement. The question is, what liability, if any, is there to the bank if both parties are aware of the practice? Can ''A'' demand reimbursement if the relationship sours, since she did not endorse the checks?


Asked on 3/24/08, 3:34 pm

1 Answer from Attorneys
David Anderson Anderson Business Law LLC

Re: Endorsements

Perhaps from HER, but certainly NOT from the bank. You deposit agreement would hopefully provide for indemnification by your account holder from any claims by a third party depositor ("A"). If there is no MISTAKE about whose account he is depositing into, his $ is gone (vis-a-vis the bank) when the deposit is made.

Is her account in her name only?

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Answered on 3/24/08, 3:44 pm


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