When Returning Items to a Reserve Bank, the Paying and Returning

question 343

Multiple Choice

When returning items to a Reserve Bank, the paying and returning banks:

• A) Cannot disclaim the warranties, authorizations, and agreements whether or not the returned check bears an endorsement of the paying bank or returning bank
• B) Authorize the Reserve Bank to handle the item in accordance with Regulation J and the operating circulars
• C) Warrant that the check bears all endorsements applied by all parties that handled the check in paper or electronic form
• D) will not be liable for the failure of a paying bank, collecting bank, or a nonbank payer to pay for an item