Generally, when an indorsement is unauthorized, the burden of loss falls on the first party to take the instrument.

Name: Generally, when an indorsement is unauthorized, the burden of loss falls on the first party to take the instrument.
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Quizplus · Accepted Answer

When an indorsement is unauthorized, the Uniform Commercial Code (UCC) generally places the burden of loss on the first party to take the instrument with the unauthorized indorsement, as they are in the best position to prevent the fraud.

Generally, When an Indorsement Is Unauthorized, the Burden of Loss