FRAUDS ON BANKS

Dominion, Volume 13, Issue 279, 19 August 1920, Page 6

FRAUDS ON BANKS

ALTERATIONS TO CHEQUES

REMOVAL OF LIABILITY

i. motion that the Law Amendment Bill.. introduced by the Hon. J. MacGregor, be read a second time pro forma and referred to the Statutes Revision ,Committee. was moved in the Legislative Council yesterday afternoon. One of the proposals in the Bill is that banks shall not be liable in cases where they have paid out on a fraudulently altered cheque which was so drawn as to afford facility for fraudulent alteration.

The Hon. C. Louisson recognised the Bill as an old friend under a new name. He wished to know what demand thei'9 was for 6uch a Bill, either from tho bankers or from tho public. He considered that Mr. MacGregor stood alone in his advocacy of the measure, and ho suggested that it would effect a saving of timo if the Bill wero stopped at. once. Tho losses incurred by banks through the means referred to were infinitesimal when compared with tho revenue of banking institutions. The Bill vould offer an inducement to banks to relax their present precautions against the passing of fraudulent cheques. _ Other members agreed with Mr. Louisson's view.

Sir Francis Bell said that without supporting or opposing tho Bill, he wished to point out that the only person affected by tho clause under discussion would be the customer of the bank, who drew the cheque. He could not understand why a customer who drew a canine carelessly should have a claim against the bank for paying out on the ■:l-euuu when it was fraudulently altered.

Ihe Hon 0. Samuel reminded theCouncil 'hat there was n. second operalive clause in the' Bill. This clnuse rend as follows: "In all cases where two or more persons have died in circumstances rendering if uncertain •which of them survived, tho deaths shall for all •purposes affecting the title to any pro* perty he presumed to havo taken place in order of seniority, and the younger he presumed to have survived the elder." Mr. Samuel thought tho Bill ought to go to tho commi'.teo if for no other renson than that the clause just quoted should he considered.

The Bill was finally referred to tho committee.