§ 26-1-4.1-208 — Misdescription of intermediary bank or beneficiary's bank

Indiana § 26-1-4.1-208

• Jurisdiction: Indiana
• Title 26: COMMERCIAL LAW
• Art. 1: UNIFORM COMMERCIAL CODE
• Ch. 4.1: Fund Transfers

Text

(a) This subsection 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 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 subdivision (1), 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 IC 26-1-4.1-302(a)(1).

Legislative History

As added by P.L.189-1991, SEC.4. Amended by P.L.199-2023, SEC.27.