093_HB2305

 
                                     LRB093 10486 MBS 10740 b

 1        AN ACT concerning business transactions.

 2        Be it enacted by the People of  the  State  of  Illinois,
 3    represented in the General Assembly:

 4        Section   5.  The  Uniform  Commercial Code is amended by
 5    adding Section 4-406.5 as follows:

 6        (810 ILCS 5/4-406.5 new)
 7        Sec. 4-406.5.  Unauthorized withdrawal or debit; notice.
 8        (a)  Notwithstanding any other provisions of  this  Code,
 9    if  the  payor  bank  pays  an  item  or otherwise debits the
10    account of a depositor of the payor bank as  a  result  of  a
11    deceptive  practice  as  described  in  subdivision (C)(2) of
12    Section 17  of  the  Criminal  Code  of  1961,  the  affected
13    depositor  must  notify  the  payor  bank of the unauthorized
14    withdrawal  or  debit  within  60  days  after  receiving   a
15    statement of account that disclosed that withdrawal or debit.
16        (b)  Following  receipt of the timely notice by the payor
17    bank from the depositor, the payor bank is entitled to return
18    the item to the person or entity that presented the item  for
19    payment and, in turn, that person or entity shall be entitled
20    to return the item to any prior endorser or transferor of the
21    item.
22        (c)  The provisions of this Section shall be given effect
23    to  the  extent that they are not in direct conflict with any
24    applicable Federal Reserve regulation or  operating  circular
25    or with any clearinghouse rule.

26        Section  99.  Effective date.  This Act takes effect upon
27    becoming law.