Wire Transfer Fraud and Legal Liability: Understanding UCC Article 4A and emerging fraud trends and tactics
Shelli Clarkston is an attorney with Spencer Fane LLP where she provides financial institutions with proactive legal counsel on regulatory and compliance matters. She received her law degrees from the University of Missouri – Kansas City and her undergraduate degree from the University of Nebraska – Lincoln.
William (“Pat”) Huttenbach is a litigation attorney concentrating on civil matters at Crain, Caton & James, P.C. He has been asked to be an expert witness on issues concerning UCC sections 3, 4, and 4A. He has answered over 210 lawsuits involving UCC sections 3, 4, and/or 4A issues. He has also personally answered over 2,000 garnishment lawsuits. Pat has many training sessions for banks to try to protect banks from fraud losses.
2 hour CLE
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Program Summary
When a fraudulent wire transfer clears, the loss does not vanish, it lands on either the bank or the accountholder, and UCC Article 4A decides which. Courts are resolving these disputes against a backdrop of escalating fraud volume, evolving fraudster tactics, and insurers reassessing whether these transactions are even covered. Any attorney advising financial institutions or commercial accountholders is already exposed to this allocation question, often working from deposit agreements and security-procedure assumptions that recent case law has overtaken. This program maps the Article 4A framework governing sender and bank liability, the commercially reasonable security-procedure requirements an institution must meet to shift loss, and the defenses and remedies available to each party—then turns to current fraud statistics, emerging tactics, loss-reduction strategies, and the landmark cases now shaping outcomes. Attendees will leave able to assess liability exposure, evaluate whether a security procedure holds, and litigate or defend wire-fraud claims with a current doctrinal map.
What Will You Learn
Attorneys will learn how UCC Article 4A allocates liability between senders and financial institutions, the security procedure requirements involved, and the defenses and remedies available to each party.
What Will You Gain
Attorneys will gain knowledge of current bank fraud statistics, emerging fraudster tactics, strategies to reduce fraud losses, and recent and landmark cases involving bank fraud.
Key topics to be discussed:
- Article 4A scope
Covers the scope and requirements of UCC Article 4A in funds transfers. - Party responsibilities
Defines rights and responsibilities of the sender and financial institution. - Security procedures
Examines security procedure requirements and how risk is allocated. - Defenses remedies
Reviews defenses and remedies available to each party in disputes. - Fraud statistics
Presents statistics on bank fraud and emerging fraud trends. - Landmark cases
Reviews recent and landmark cases involving bank fraud.
This course is co-sponsored with myLawCLE.
Closed-captioning available
Speakers
Shelli Clarkston, JD, LLM | Spencer Fane LLP
Shelli Clarkston is an attorney with Spencer Fane LLP where she provides financial institutions with proactive legal counsel on regulatory and compliance matters. She received her law degrees from the University of Missouri – Kansas City and her undergraduate degree from the University of Nebraska – Lincoln. In addition, she has a Master’s degree from Doane University.
Before joining Spencer Fane, she was the Risk and Compliance Officer for a financial services technology platform with one of the world’s largest technology companies, where she oversaw the regulatory compliance requirements of the platform and handled all risk-related matters. She also was General Counsel for a community bank, where she managed all legal, regulatory, compliance, and corporate matters.
William Huttenbach | Crain, Caton & James, P.C.
William (“Pat”) Huttenbach is a litigation attorney concentrating on civil matters at Crain, Caton & James, P.C. He has been asked to be an expert witness on issues concerning UCC sections 3, 4, and 4A. He has answered over 210 lawsuits involving UCC sections 3, 4, and/or 4A issues. He has also personally answered over 2,000 garnishment lawsuits. Pat has many training sessions for banks to try to protect banks from fraud losses. Pat has written numerous articles on banking topics and has given speeches to the banking industry on how to better protect banks in litigation through updated deposit agreements. Pat also routinely handles many other types of lawsuits against banks including lender liability claims, FCRA claims, FDCPA claims, Texas Finance Code claims, tortious interference claims, insurance claim litigation, fidelity and surety insurance coverage, DTPA claims, injunctions, employment law, landlord-tenant disputes, probate matters, property disputes, real estate tax litigation, breach of contract, business torts, construction law disputes, defamation, libel and slander, and other general business matters.
Agenda
Session I – Understanding UCC Article 4A: Risk Allocation and Remedies in Funds Transfers | 2:00pm – 3:00pm
- The scope and requirements of UCC Article 4A
- The rights and responsibilities of each party: The sender and the financial institution
- The requirements for security procedures and the allocation of risk
- Defenses and remedies that can be used by each party
Break | 3:00pm – 3:10pm
Session II – Bank Fraud Today: Trends, Tactics, and Legal Responses | 3:10pm – 4:10pm
- Statistics on bank fraud
- Emerging fraud trends and tactics
- Strategies to reduce fraud losses
- Review of recent and landmark fraud cases
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