Chapter 410

410.502   Creditor process served on receiving bank; setoff by beneficiary’s bank.

410.503   Injunction or restraining order with respect to funds transfer.

410.504   Order in which items and payment orders may be charged to account; order of withdrawals from account.

410.505   Preclusion of objection to debit of customer’s account.

410.506   Rate of interest.

410.507   Choice of law.

Ch. 410 Cross-reference Cross-reference: See definitions in s. 401.201.

subch. I of ch. 410 SUBCHAPTER I

SUBJECT MATTER AND DEFINITIONS

410.101 410.101 Short title. This chapter may be cited as uniform commercial code — funds transfers.

410.101 History History: 1991 a. 304.

410.102 410.102 Subject matter. Except as otherwise provided in s. 410.108, this chapter applies to funds transfers as defined in s. 410.104 (1).

410.102 History History: 1991 a. 304.

410.103 410.103 Payment order; definitions.

410.103(1) (1) In this chapter:

410.103(1)(a) (a) “Beneficiary” means the person to be paid by the beneficiary’s bank.

410.103(1)(b) (b) “Beneficiary’s bank” means the bank identified in a payment order in which an account of the beneficiary is to be credited pursuant to the order or which otherwise is to make payment to the beneficiary if the order does not provide for payment to an account.

410.103(1)(c) (c) “Payment order” means an instruction of a sender to a receiving bank, transmitted orally, electronically, or in writing, to pay, or to cause another bank to pay, a fixed or determinable amount of money to a beneficiary if all of the following apply:

410.103(1)(c)1. 1. The instruction does not state a condition to payment to the beneficiary other than time of payment.

410.103(1)(c)2. 2. The receiving bank is to be reimbursed by debiting an account of, or otherwise receiving payment from, the sender.

410.103(1)(c)3. 3. The instruction is transmitted by the sender directly to the receiving bank or to an agent, funds-transfer system, or communication system for transmittal to the receiving bank.

410.103(1)(d) (d) “Receiving bank” means the bank to which the sender’s instruction is addressed.

410.103(1)(e) (e) “Sender” means the person giving the instruction to the receiving bank and includes a customer described in s. 410.202 (4).

410.103(2) (2) If an instruction complying with sub. (1) (c) is to make more than one payment to a beneficiary, the instruction is a separate payment order with respect to each payment.

410.103(3) (3) A payment order is issued when it is sent to the receiving bank.

410.103 History History: 1991 a. 304.

410.104 410.104 Funds transfer; definitions. In this chapter:

410.104(1) (1) “Funds transfer” means the series of transactions, beginning with the originator’s payment order, made for the purpose of making payment to the beneficiary of the order. “Funds transfer” includes any payment order issued by the originator’s bank or an intermediary bank intended to carry out the originator’s payment order. A funds transfer is completed by acceptance by the beneficiary’s bank of a payment order for the benefit of the beneficiary of the originator’s payment order.

410.104(2) (2) “Intermediary bank” means a receiving bank other than the originator’s bank or the beneficiary’s bank.

410.104(3) (3) “Originator” means the sender of the first payment order in a funds transfer.

410.104(4) (4) “Originator’s bank” means the receiving bank to which the payment order of the originator is issued if the originator is not a bank or the originator if the originator is a bank.

410.104 History History: 1991 a. 304.

410.105 410.105 Other definitions.

410.105(1) (1) In this chapter:

410.105(1)(a) (a) “Authorized account” means a deposit account of a customer in a bank designated by the customer as a source of payment of payment orders issued by the customer to the bank. If a customer does not so designate an account, any account of the customer is an authorized account if payment of a payment order from that account is not inconsistent with a restriction on the use of that account.

410.105(1)(b) (b) “Bank” means a person engaged in the business of banking and includes a savings bank, savings and loan association, credit union, and trust company. A branch or separate office of a bank is a separate bank for purposes of this chapter.

410.105(1)(c) (c) “Customer” means a person, including a bank, having an account with a bank or from whom a bank has agreed to receive payment orders.

410.105(1)(d) (d) “Funds-transfer business day” of a receiving bank means the part of a day during which the receiving bank is open for the receipt, processing, and transmittal of payment orders and for cancellations and amendments of payment orders.

410.105(1)(e) (e) “Funds-transfer system” means a wire transfer network, automated clearinghouse, or other communication system of a clearinghouse or other association of banks through which a payment order by a bank may be transmitted to the bank to which the order is addressed.

410.105(1)(f) (f) “Good faith” means honesty in fact and the observance of reasonable commercial standards of fair dealing.

410.105(1)(g) (g) “Prove” with respect to a fact means to meet the burden of establishing the fact.

410.105(2) (2) Other definitions applying to this chapter and the sections in which they appear are:

410.105(2)(a) (a) “Acceptance” — s. 410.209.

410.105(2)(b) (b) “Beneficiary” — s. 410.103 (1) (a).

410.105(2)(c) (c) “Beneficiary’s bank” — s. 410.103 (1) (b).

410.105(2)(d) (d) “Executed” — s. 410.301 (1).

410.105(2)(e) (e) “Execution date” — s. 410.301 (2).

410.105(2)(f) (f) “Funds transfer” — s. 410.104 (1).

410.105(2)(g) (g) “Funds-transfer system rule” — s. 410.501 (2) (a).

410.105(2)(h) (h) “Intermediary bank” — s. 410.104 (2).

410.105(2)(i) (i) “Originator” — s. 410.104 (3).

410.105(2)(j) (j) “Originator’s bank” — s. 410.104 (4).

410.105(2)(k) (k) “Payment by beneficiary’s bank to beneficiary” — s. 410.405.

410.105(2)(L) (L) “Payment by originator to beneficiary” — s. 410.406.

410.105(2)(m) (m) “Payment by sender to receiving bank” — s. 410.403.

410.105(2)(n) (n) “Payment date” — s. 410.401.

410.105(2)(p) (p) “Payment order” — s. 410.103 (1) (c).

410.105(2)(q) (q) “Receiving bank” — s. 410.103 (1) (d).

410.105(2)(r) (r) “Security procedure” — s. 410.201.

410.105(2)(s) (s) “Sender” — s. 410.103 (1) (e).

410.105(3) (3) The following definitions in ch. 404 apply to this chapter:

410.105(3)(a) (a) “Clearinghouse” — s. 404.104 (1) (d).

410.105(3)(b) (b) “Item” — s. 404.104 (1) (i).

410.105(3)(c) (c) “Suspends payments” — s. 404.104 (1) (L).

410.105(4) (4) In addition ch. 401 contains general definitions and principles of construction and interpretation applicable throughout this chapter.

410.105 History History: 1991 a. 304; 1995 a. 449.

410.106 410.106 Time payment order is received.

410.106(1) (1) The time of receipt of a payment order or communication canceling or amending a payment order is determined by the rules applicable to receipt of a notice stated in s. 401.202 (6). A receiving bank may fix a cutoff time or times on a funds-transfer business day for the receipt and processing of payment orders and communications canceling or amending payment orders. Different cutoff times may apply to payment orders, cancellations, or amendments, or to different categories of payment orders, cancellations, or amendments. A cutoff time may apply to senders generally or different cutoff times may apply to different senders or categories of payment orders. If a payment order or communication canceling or amending a payment order is received after the close of a funds-transfer business day or after the appropriate cutoff time on a funds-transfer business day, the receiving bank may treat the payment order or communication as received at the opening of the next funds-transfer business day.

410.106(2) (2) If this chapter refers to an execution date or payment date or states a day on which a receiving bank is required to take action, and the date or day does not fall on a funds-transfer business day, the next day that is a funds-transfer business day is treated as the date or day stated, unless the contrary is stated in this chapter.

410.106 History History: 1991 a. 304; 2003 a. 321; 2009 a. 320.

410.107 410.107 Federal reserve regulations and operating circulars. Regulations of the board of governors of the federal reserve system and operating circulars of the federal reserve banks supersede any inconsistent provision of this chapter to the extent of the inconsistency.

410.107 History History: 1991 a. 304.

410.108 410.108 Relationship to Electronic Fund Transfer Act.

410.108(1) (1) Except as provided in sub. (2), this chapter does not apply to a funds transfer any part of which is governed by the electronic fund transfer act, 15 USC 1693 to 1693r.

410.108(2) (2) This chapter applies to a funds transfer that is a remittance transfer, as defined in 15 USC 1693o-1, unless the remittance transfer is an electronic fund transfer, as defined in 15 USC 1693a.

410.108(3) (3) In a funds transfer to which this chapter applies, in the event of an inconsistency between an applicable provision of this chapter and an applicable provision of the electronic fund transfer act, the provision of the electronic fund transfer act governs to the extent of the inconsistency.

410.108 History History: 1991 a. 304; 2013 a. 33.

subch. II of ch. 410 SUBCHAPTER II

ISSUE AND ACCEPTANCE OF PAYMENT ORDER

410.201 410.201 Security procedure. “Security procedure” means a procedure established by agreement of a customer and a receiving bank to verify that a payment order or communication amending or canceling a payment order is that of the customer or to detect error in the transmission or the content of the payment order or communication. A security procedure may require the use of algorithms or other codes, identifying words or numbers, encryption, callback procedures, or similar security devices. Comparison of a signature on a payment order or communication with an authorized specimen signature of the customer is not by itself a security procedure.

410.201 History History: 1991 a. 304.

410.202 410.202 Authorized and verified payment orders.

410.202(1) (1) A payment order received by the receiving bank is the authorized order of the person identified as sender if that person authorized the order or is otherwise bound by it under the law of agency.

410.202(2) (2) 

410.202(2)(a) (a) If a bank and its customer have agreed that the authenticity of payment orders issued to the bank in the name of the customer as sender will be verified pursuant to a security procedure, a payment order received by the receiving bank is effective as the order of the customer, whether or not authorized, if all of the following apply:

410.202(2)(a)1. 1. The security procedure is a commercially reasonable method of providing security against unauthorized payment orders.

410.202(2)(a)2. 2. The bank proves that it accepted the payment order in good faith and in compliance with the security procedure and any written agreement or instruction of the customer restricting acceptance of payment orders issued in the name of the customer.

410.202(2)(b) (b) The bank is not required to follow an instruction that violates a written agreement with the customer or notice of which is not received at a time and in a manner affording the bank a reasonable opportunity to act on it before the payment order is accepted.