Business Check Fraud
 
Your company can be held liable for business check fraud losses that third parties incur from honoring counterfeit checks and legitimate checks which have been “stopped” by your business. The law protects any third parties who honor and cash any checks presented to them where such parties are considered to be a ‘Holder in Due Course’. This protection spells big trouble for unwitting businesses here in Illinois and in other states that have adopted the Uniform Commercial Code, or have adopted similar protections.
What is a ‘Holder in Due Course’…in Layman’s Terms?
A Holder in Due Course (HIDC) is a defined person or entity under the Uniform Commercial Code (UCC) that is afforded significant legal protections when presented with a a seemingly legitimate check. Unfortunately for businesses, especially small business, an HIDC significantly impacts the business’s liability for check fraud and the checks it issues!
In simple terms, a Holder in […]