Using her companys check-signing machine, Doris forged $150,000 of checks on the account of her employer, Winkie,

Question:

Using her company’s check-signing machine, Doris forged $150,000 of checks on the account of her employer, Winkie, Inc. One of Doris’s jobs at the company was to prepare checks for the company president, Willie, to sign. He did not
(1) Look at the sequence of check numbers;
(2) Examine the monthly account statements; or
(3) Reconcile company records with bank statements.
Willie’s bank, as a matter of policy, did not check indorsements on checks with a of less than $1,000. By accident, it paid a forged check that had not even been indorsed. Is the bank liable to Winkie, Inc., for the forged checks?

Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...