Cengage Advantage Books: Business Law Today, The Essentials 10th Edition by Roger LeRoy Miller

Exercise 3

Case Problem with Sample Answer-Honoring Checks. Adley Abdulwahab (Wahab) opened an account on behalf of W Financial Group, LLC, with Wells Fargo Bank. Wahab was one of three authorized signers on the account. Five months later, Wahab withdrew $1,701,250 from W Financial's account to buy a cashier's check payable to Lubna Lateef. Wahab visited a different Wells Fargo branch and deposited the check into the account of CA Houston Investment Center, LLC. Wahab was the only authorized signer on this account. Lateef never received or indorsed the check. W Financial filed a suit to recover the amount. Applying the rules for payment on a forged indorsement, who is liable? [ Jones v. Wells Fargo Bank, 666 F.3d 955 (5th Cir. 2012)] (See page 418.)