Can a bank disburse funds from an account which requires two signatures without both signatures?
Untitled
In spite of best efforts to adhere to two signature requirements, banks sometimes miss a check with one of the signatures missing, because of the highly automated processing methods used today in banking. In fact, most banks have stopped or are attempting to discontinue any agreements to restrict payment agreements involving multiple signature requirements.
If a bank has a two-signatures required agreement in place and pays a check with only one signature, that breaches the agreement. The legal effect is the same as if the check had not been signed at all. However, if the payment benefited the customer (for example, if the payment was made to a creditor of the customer such as a utility company), the customer would probably have no claim for damages against the bank.
BankingQuestions.com is a free service made possible by the generous support of our advertisers. Advertisers are not responsible for site content. Please help us keep BankingQuestions.com FREE by supporting our advertisers. When you see an ad for a product or service you may have an interest in, click through to learn more.
Accounts
Article
Q&A
Podcast
Video
Blog
Discussions
PDF
Powerpoint
In spite of best efforts to adhere to two signature requirements, banks sometimes miss a check with one of the signatures missing, because of the highly automated processing methods used today in banking. In fact, most banks have stopped or are attempting to discontinue any agreements to restrict payment agreements involving multiple signature requirements.