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Recent Posts
- Virginia Court in Email ACH Funds Transfer Fraud Case Relies on NACHA Rules in Permitting Claims Against Bank
- Nevada Bench Trial Applies UCC in Allocating Loss Between Hacked Seller and Duped Buyer
- Salvatore Scanio’s Article on the NAIC Insurance Data Security Model Law Published by ABA’s Cybersecurity and Data Privacy Committee
- New York Court Rejects Cut Down of UCC Art. 4A’s 1-Year Notice Rule for Unauthorized Funds Transfers
- FinCEN Advisory Highlights Cybercriminals Exploiting COVID-19 Pandemic for Funds Transfer Fraud
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Tag Archives: UCC Article 4A
Nevada Bench Trial Applies UCC in Allocating Loss Between Hacked Seller and Duped Buyer
In cybercrime cases, there often are two victims: one a business subject to an email hack and another that transmits funds based on fraudulent wire instructions from the hacked email account. Which party should bear the loss? A Nevada federal … Continue reading
Posted in BANKING & FINANCE, CORPORATE, INSURANCE, INTERNATIONAL, LITIGATION
Tagged BEC, Business Email Compromise, Comparative Negligence, Cybercrime, Cybersecurity, Funds Transfer Fraud, Salvatore Scanio, UCC, UCC Article 4A, UCC Articles 3 and 4, Unauthorized Transfer, Uniform Commercial Code, Wire Transfer Fraud
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New York Court Rejects Cut Down of UCC Art. 4A’s 1-Year Notice Rule for Unauthorized Funds Transfers
In a recent unpublished New York opinion, the court found a bank’s 60-day notice provision in its Account Terms and Conditions for reporting unauthorized funds transfers to be unenforceable. Cardino v. J.P. Morgan Chase Bank, N.A, 2020 N.Y. Misc. LEXIS … Continue reading
Posted in BANKING & FINANCE, CORPORATE, INSURANCE, LITIGATION
Tagged Account Terms and Conditions, Bank Contract, Bank Liability, Bank Notice, Bank-Customer Agreement, Cybercrime, Cybersecurity, Funds Transfer Fraud, Notice Cut-Down, Salvatore Scanio, Statute of Repose, UCC Article 4A, Unauthorized Transfer, Uniform Commercial Code, Wire Transfer Fraud
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Illinois Supreme Court Holds a Non-bank Entity is a “Bank” Under UCC Art. 4A
The Illinois Supreme Court, applying the Uniform Commercial Code’s broad definition of a “bank,” held that a futures commission merchant was a “bank” for purposes of a fraudulent wire transfer under Article 4A. Whitaker v. Wedbush Securities, Inc., 2020 Ill. … Continue reading
Posted in BANKING & FINANCE, CORPORATE, INSURANCE, INTERNATIONAL, LITIGATION
Tagged Account Takeover, Bank Liability, Cybercrime, Cybersecurity, Definition of Bank, Email Fraud, Funds Transfer Fraud, futures commission merchant, Robert Ludwig, Salvatore Scanio, UCC Article 4A, Uniform Commercial Code, Wire Transfer Fraud
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D.C. Law Firm Victim of Email Wire Fraud Fails to Sufficiently Plead Bank Aiding and Abetting
A recent email funds transfer fraud case illustrates a novel claim against a bank dismissed at the pleading stage. Beins, Axelrod, PC v. Analytics, LLC, 2020 U.S. Dist. LEXIS 71713 (D.D.C. Apr. 23, 2020). After a D.C. law firm, seeking its … Continue reading
Posted in BANKING & FINANCE, CORPORATE, INSURANCE, INTERNATIONAL, LITIGATION
Tagged Aiding and Abetting Liability, Attorney’s Fees, Bank Liability, Business Email Compromise, Computer Fraud and Abuse Act, Cybercrime, Cybersecurity, Email Fraud, Funds Transfer Fraud, Robert Ludwig, Salvatore Scanio, UCC Article 4A, Uniform Commercial Code, Wire Transfer Fraud
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Conflicting Results in Recent Funds Transfer Coverage Cases in Virginia
Three recent insurance coverage cases arising from fraudulent email/funds transfer schemes in the Eastern District of Virginia arrived at different results. In Midlothian Enter., Inc. v. Owners Ins. Co., 2020 U.S. Dist. LEXIS 30237 (E.D. Va. Feb. 5, 2020), hackers … Continue reading
Posted in BANKING & FINANCE, CORPORATE, INSURANCE, INTERNATIONAL, LITIGATION
Tagged Account Takeover, ACH Fraud, BEC, Business Email Compromise, Computer Fraud, Cyber Insurance, Cybercrime, Cybersecurity, Funds Transfer Fraud, Insurance Coverage, Malware, UCC Article 4A, Wire Transfer Fraud
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Receiving Bank in Ohio Funds Transfer Case Allowed Questionable Damages Offset
In a new decision in an ongoing account takeover case involving fraudulent ACH transactions, the district court, after denying cross-motions for summary judgment, ruled that should the bank lose at trial, it could set off any damages with defense costs. … Continue reading
Posted in CORPORATE, INSURANCE, INTERNATIONAL, LITIGATION
Tagged Account Takeover, ACH Fraud, Attorney’s Fees, Cybercrime, Cybersecurity, Funds Transfer Fraud, Insurance Recovery, Malware, Multifactor Authentication, Salvatore Scanio, Setoff Defense, UCC Article 4A, Uniform Commercial Code, Wire Transfer Fraud
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Cybercriminals Exploiting COVID-19 Pandemic for Funds Transfer Fraud
In April 2020, the FBI issued four notices detailing the increased level of cybercrime seeking to exploit the COVID-19 (coronavirus) pandemic. Cybercriminals are exploiting the pandemic in countless ways, from preying on human vulnerability to taking advantage of the increased use of online … Continue reading
Posted in BANKING & FINANCE, CORPORATE, INSURANCE, INTERNATIONAL, LITIGATION
Tagged ABA, Account Takeover, ACH Fraud, Business Email Compromise, coronavirus, COVID-19, Cybercrime, Cybersecurity, Dark Web, Data Breach, FBI, FSLC, Funds Transfer Fraud, Insurance Recovery, Malware, money mules, Multifactor Authentication, Robert Ludwig, Salvatore Scanio, Social Engineering, Social Media, SWIFT, UCC Article 4A, Uniform Commercial Code, Wire Transfer Fraud
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Technology and Salvage: Using Social Media in Recovery and Allocating Cybercrime Funds Transfers to Third Parties
Robert W. Ludwig and Salvatore Scanio presented their paper, Technology and Salvage: Using Social Media in Recovery and Allocating Cybercrime Funds Transfers to Third Parties, at the Fidelity and Surety Law 2020 Midwinter Conference of the American Bar Association, Tort … Continue reading
Posted in BANKING & FINANCE, CORPORATE, INSURANCE, INTERNATIONAL, LITIGATION
Tagged ABA, Account Takeover, ACH Fraud, Business Email Compromise, Cybercrime, Cybersecurity, Dark Web, Data Breach, FSLC, Funds Transfer Fraud, Insurance Recovery, Malware, Multifactor Authentication, Robert Ludwig, Salvatore Scanio, Social Engineering, Social Media, SWIFT, UCC Article 4A, Uniform Commercial Code, Wire Transfer Fraud
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Banking Regulators Issue Joint Statement on Heightened Cybersecurity Risk
On January 16, 2020, the FDIC and OCC issued a joint statement (FDIC FIL-3-2020 , OCC Bulletin 2020-5) to remind banks of sound cybersecurity risk management principles. The statement observes, “Cyber actors often use malware to exploit weaknesses in a [bank’s] … Continue reading
Posted in BANKING & FINANCE, CORPORATE, INSURANCE, INTERNATIONAL, LITIGATION
Tagged Business Continuity Plans, Cyber Insurance, Cybercrime, Cybersecurity, Data Breach, Data Protection, Data Recovery, FDIC, Funds Transfer, Identity Management, IT, Malware, Multifactor Authentication, OCC, Risk Management, Salvatore Scanio, Social Engineering, UCC Article 4A
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