In a joint comment letter with five financial trade groups today, the American Bankers Association wrote to the Federal Reserve in support of proposed amendments to address situations involving disputes about whether portions of an electronic check has been altered or whether the item is a forgery. In cases where the original paper check is not available, for the purposed of determining the burden of proof, it would be assumed that the item has been altered rather than forged.
“We believe that alteration of a legitimate check is the more common type of check fraud today in which disputes arise between banks, and therefore a presumption of alteration in those disputes where the evidence is lacking is appropriate,” the groups said. They added, however, that the presumption should not be extended in cases where the paying bank receives the original check but is unable to produce the original check in subsequent disputes, regardless of the reason. For more information, contact ABA’s Nessa Feddis.