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21 November 2015

Gould & Ratner litigators, let by Paul Carroll and Ellen Chapelle, successfully defended its client, a middle market bank in the Chicagoland market, in a jury trial conducted in the Circuit Court of Cook County, Illinois.The case concerned a massive fraud that was perpetrated on a major airline carrier by a former employee. The fraud spanned decades and involved a loss of $6,800,000.00. The fraud scheme involved an airline employee’s approval for payment of phony invoices to fictitious vendors of the airline. Two of the fictitious vendors opened commercial deposit accounts at the client bank through which the deposits were funneled. The airline’s insurance company paid on the loss under an employee theft policy and sought to recover from the bank for the losses under Section 3-404 of the Uniform Commercial Code. Section 3-404 of the UCC provides that a bank can be liable if it negligently opens a bank account and its negligence substantially contributes to the losses. Plaintiff’s theory in this case was that the bank failed to verify the legitimacy of the two vendors before opening the accounts. GR’s litigation team prevailed on the defence theory of the case – the bank could not have detected the fraud that was occurring within the airline and its account opening policies were consistent with industry standards.[caption id="attachment_2970" align="alignnone" width="150"]   Paul Carroll[/caption][caption id="attachment_2971" align="alignnone" width="150"] Ellen Chapelle[/caption]

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