§ 6A-3-404. Impostors — Fictitious payees.
(a) If an impostor, by use of the mails or otherwise, induces the issuer of an instrument to issue the instrument to the impostor, or to a person acting in concert with the impostor, by impersonating the payee of the instrument or a person authorized to act for the payee, an indorsement of the instrument by any person in the name of the payee is effective as the indorsement of the payee in favor of a person who, in good faith, pays the instrument or takes it for value or for collection.
(b) If (i) a person whose intent determines to whom an instrument is payable (§ 6A-3-110(a) or (b)) does not intend the person identified as payee to have any interest in the instrument, or (ii) the person identified as payee of an instrument is a fictitious person, the following rules apply until the instrument is negotiated by special indorsement:
(1) Any person in possession of the instrument is its holder.
(2) An indorsement by any person in the name of the payee stated in the instrument is effective as the indorsement of the payee in favor of a person who, in good faith, pays the instrument or takes it for value or for collection.
(c) Under subsection (a) or (b), an indorsement is made in the name of a payee if (i) it is made in a name substantially similar to that of the payee or (ii) the instrument, whether or not indorsed, is deposited in a depositary bank to an account in a name substantially similar to that of the payee.
(d) With respect to an instrument to which subsection (a) or (b) applies, if a person paying the instrument or taking it for value or for collection fails to exercise ordinary care in paying or taking the instrument and that failure substantially contributes to loss resulting from payment of the instrument, the person bearing the loss may recover from the person failing to exercise ordinary care to the extent the failure to exercise ordinary care contributed to the loss.
History of Section.P.L. 2000, ch. 238, § 3; P.L. 2000, ch. 421, § 3.
Structure Rhode Island General Laws
Title 6A - Uniform Commercial Code
Chapter 6A-3 - Negotiable Instruments
Section 6A-3-401. - Signature.
Section 6A-3-402. - Signature by representative.
Section 6A-3-403. - Unauthorized signature.
Section 6A-3-404. - Impostors — Fictitious payees.
Section 6A-3-405. - Employer’s responsibility for fraudulent indorsement by employee.
Section 6A-3-406. - Negligence contributing to forged signature or alteration of instrument.
Section 6A-3-407. - Alteration.
Section 6A-3-408. - Drawee not liable on unaccepted draft.
Section 6A-3-409. - Acceptance of draft — Certified check.
Section 6A-3-410. - Acceptance varying draft.
Section 6A-3-411. - Refusal to pay cashier’s checks, teller’s checks, and certified checks.
Section 6A-3-412. - Obligation of issuer of note or cashier’s check.
Section 6A-3-413. - Obligation of acceptor.
Section 6A-3-414. - Obligation of drawer.
Section 6A-3-415. - Obligation of indorser.
Section 6A-3-416. - Transfer warranties.
Section 6A-3-417. - Presentment warranties.
Section 6A-3-418. - Payment or acceptance by mistake.