§ 4-4.5-208 — Misdescription of intermediary bank or beneficiary's bank

Colorado § 4-4.5-208

• Jurisdiction: Colorado
• Title 04: Uniform
• Art.: Funds Transfers

Text

(a)
This subsection (a) applies to a payment order identifying an intermediary bank or
the beneficiary's bank only by an identifying number.

(1) The receiving bank may rely on the number as the proper identification of
the intermediary or beneficiary's bank and need not determine whether the number
identifies a bank.

(2) The sender is obliged to compensate the receiving bank for any loss and
expenses incurred by the receiving bank as a result of its reliance on the number in
executing or attempting to execute the order.

(b) This subsection (b) applies to a payment order identifying an intermediary
bank or the beneficiary's bank both by name and an identifying number if the name
and number identify different persons.

(1) If the sender is a bank, the receiving bank may rely on the number as the
proper identification of the intermediary or beneficiary's bank if the receiving bank,
when it executes the sender's order, does not know that the name and number
identify different persons. The receiving bank need not determine whether the
name and number refer to the same person or whether the number refers to a bank.
The sender is obliged to compensate the receiving bank for any loss and expenses
incurred by the receiving bank as a result of its reliance on the number in executing
or attempting to execute the order.

(2) If the sender is not a bank and the receiving bank proves that the sender,
before the payment order was accepted, had notice that the receiving bank might
rely on the number as the proper identification of the intermediary or beneficiary's
bank even if it identifies a person different from the bank identified by name, the
rights and obligations of the sender and the receiving bank are governed by
subsection (b)(1) of this section, as though the sender were a bank. Proof of notice
may be made by any admissible evidence. The receiving bank satisfies the burden
of proof if it proves that the sender, before the payment order was accepted, signed
a record stating the information to which the notice relates.

(3) Regardless of whether the sender is a bank, the receiving bank may rely
on the name as the proper identification of the intermediary or beneficiary's bank if
the receiving bank, at the time it executes the sender's order, does not know that
the name and number identify different persons. The receiving bank need not
determine whether the name and number refer to the same person.

(4) If the receiving bank knows that the name and number identify different
persons, reliance on either the name or the number in executing the sender's
payment order is a breach of the obligation stated in section 4-4.5-302 (a)(1).

Legislative History

Source: L. 90: Entire article added, p. 349, � 1, effective January 1, 1991. L. 2023: (b)(2) amended, (SB 23-090), ch. 136, p. 533, � 29, effective August 7.