We believe that no firm handles more litigation or has been the successful attorneys of record for leading decisions on UCC check and wire transfer cases than ZEK.

ZEK is a bank payment law specialist, in both advice and litigation. It is equally conversant in the both the New York (minority) Articles 3 and 4 of the Uniform Commercial Code as well as the 1990’s Code that governs Articles 3 and 4 in the other 49 states, as well as UCC Article 4A, applicable to commercial wire transfers in all states. We have broad UCC expertise, which enables ZEK to provide deep choice of law analysis as well as advice about which code version is more favorable in a particular claim where legal arguments can be made as to the applicability of either.

We believe that no firm handles more litigation or has been the successful attorneys of record for leading decisions on UCC check and wire transfer cases than ZEK. This expertise, which resides in a number of lawyers in the firm, means that ZEK can analyze claims quickly and efficiently and provide early action advice to eliminate future litigation or ensure early stage resolution.

We have widespread experience handling: (i) the typical dishonest bookkeeper/accountant claims, including forged maker signatures, diversion of checks and subsequent deposits with forged indorsements; (ii) bank operational errors involving deposit of checks with missing or restrictive indorsements. But our knowledge of UCC Articles 3 and 4 is much deeper and broader than fraud case experience. We are adept at all of the Article 3 and 4 defenses employed by banks in cases brought against banks and the ways in which to employ them based on the UCC framework of shifting burdens of proof depending on the types of cases. Thus, for example, the question of “commercial reasonableness” must sometimes be proven affirmatively by banks and while at others bank’s customer.

We are aware of such arcane rules as the meaning of a “payable through” draft or check, when an unindorsed check is considered to bear an indorsement, the rules applicable to cashing checks in various jurisdictions, the wide range of damages recoverable in potential wrongful dishonor claims, the midnight deadline rule and its implications for damages in the check collection process, when an indorsement is in the name of the payee even though it does not match that of the payee, and all of the rules concerning stopping payment on both regular and bank checks, etc. We have also been successful in handling claims against client banks by asserting indemnification rights under the UCC or private contract or by pursuing claims against third-party payors such as insurance companies.

While there has been a paucity of reported decisions concerning cyberfraud, ZEK is an expert in such issues, based on its encyclopedic knowledge of UCC Article 4A. We are way up the learning curve on the latest requirements for commercially reasonable security procedures, which forms the crux of most Article 4A cybersecurity cases and claims, including the latest thinking on technology related issues affecting such security procedures, as well as the ever-changing requirements for improving bank technology promulgated by US government agencies.

Again, our experience permits early and accurate case assessment and analysis which can lead to early claim resolution and litigation avoidance. We also provide guidance with implementing policies and procedures to reduce or minimize fraud and fraudulent claims. ZEK also is able to point out flaws or omissions in banks’ customer agreements and to recommend changes that will protect banks and enable them to assert successful contract defenses to claims.

Based on our longstanding practice in this area, we are not only aware of the applicable law but also of many of the systems used by our bank clients in, for example the check collection process. We know for example how checks are examined and processed. Similarly, we are well familiar with the process of electronic payment and changing regulations concerning such payment such as the relatively recent changes to Federal Reserve Regulation J. Such deep knowledge enables us to provide a level of analysis of related legal issues that is far superior to those who do not have and maintain this expertise.

ZEK is similarly familiar with and provides advice to our banking clients about new technologies and new products that provide new risks to the bank. We have advised banks with respect to claims that arise not only from traditional paper check transactions, but also from emerging and new payment systems, including ACH-based point of sale transactions governed by NACHA and remote deposit capture transactions that implicate Check 21 as well ECCHO (the Electronic Check Clearing Organization) Rules.

ZEK also has substantial expertise in Reg E/EFTA matters. It has both defended banks, on Reg E claims in federal court and also regularly advised national and regional banks, on consumer regulatory matters involving EFTA/Reg E. We have, for example, provided legal advice on whether specific transactions (including telephone transfers) fall within the scope of Reg E, whether potential claims are time-barred, whether claims meet the legal definition of an unauthorized transfer, the applicable deadlines for providing provisional credit and reporting the findings of the bank’s investigation of the claim and the new regulations governing remittances. Our analysis of claims enables our bank clients to make early decisions about whether or not to pay customers, which is particularly important for the banks because the EFTA provides for a payment of a customer’s legal fees for a rejected claim that is later upheld in court. In addition to advising our client banks on actual claims, we also analyze and advise banks regarding claim handling policies and procedures, particularly with respect to implementing new programs aimed at reducing fraudulent claim payments and/or providing guidance for bank Reg E audits.