My former CFO and signer on my company's account was recently fired. Before he was released he would cash payroll checks for the employees. He would give the cash to the employees then have them sign the back of the check for an endorsement. Several months later he would double endorse the checks and cash them using the company's business checking account. Is the bank legally allowed to do this or do we have some recourse?
The bank's relationship with you is covered by its deposit contract and by the documents your business provided that granted individuals authority to transact business on the account. Such documents, called corporate resolutions, rarely if ever, provide check cashing authorizations.
However, depending on how long the practice continued before your former CFO was fired, the bank might be able to argue that your company ratified his actions by allowing them to occur for so long. If you get resistance from the bank when you broach the subject of recovering those sums, contact legal counsel.
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My former CFO and signer on my company's 
The bank's relationship with you is covered by its 