Illinois Compiled Statutes
810 ILCS 5/3-404 (2026)
Impostors; fictitious payees
✓ current as of May 2026
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(810 ILCS 5/3-404)
(from Ch. 26, par. 3-404)
Sec. 3-404.
Impostors; fictitious payees.
(a) If an impostor, by use of the mails or otherwise, induces the issuer
of an instrument to issue the instrument to the impostor, or to a person
acting in concert with the impostor, by impersonating the payee of the
instrument or a person authorized to act for the payee, an indorsement of
the instrument by any person in the name of the payee is effective as the
indorsement of the payee in favor of a person who in good faith, pays the
instrument or takes it for value or for collection.
(b) If (i) a person whose intent determines to whom an instrument is
payable (Section 3-110(a) or (b)) does not intend the person identified as
payee to have any interest in the instrument, or (ii) the person identified
as payee of an instrument is a fictitious person, the following rules apply
until the instrument is negotiated by special indorsement:
(1) Any person in possession of the instrument is its | holder. |
(2) An indorsement by any person in the name of the | payee stated in the instrument is effective as the indorsement of the payee in favor of a person who in good faith, pays the instrument or takes it for value or for collection. |
(c) Under subsection (a) or (b), an indorsement is made in the name of a
payee if (i) it is made in a name substantially similar to that of the
payee or (ii) the instrument, whether or not indorsed, is deposited in a
depositary bank to an account in a name substantially similar to that of
the payee.
(d) With respect to an instrument to which subsection (a) or (b)
applies, if a person paying the instrument or taking it for value or for
collection fails to exercise ordinary care in paying or taking the
instrument and that failure substantially contributes to loss resulting
from payment of the instrument, the person bearing the loss may recover
from the person failing to exercise ordinary care to the extent the failure
to exercise ordinary care contributed to the loss.
(Source: P.A. 87-582; 87-1135.)
Notes of Decisions
Cited in 5
cases, 1993–2004 · leading case: Nat'l Accident Ins. Underwriters, Inc. v. Citibank, F.S.B., 243 F. Supp. 2d 763 (N.D. Ill. 2002).
Nat'l Accident Ins. Underwriters, Inc. v. Citibank, F.S.B., 243 F. Supp. 2d 763 (N.D. Ill. 2002). “” (Motion to Dismiss, at 3-4, citing 810 ILCS 5/3-404, Comment 2, Case # 5). Because Carter was a person entitle to enforce the instrument, as defendant would have it, UCC § 3-420 does not apply and the complaint, based solely on that section, must be dismissed.”
Barber v. First Nat'l Bank of Chillicothe (In Re Ostrom-Martin, Inc.), 155 B.R. 997 (Bankr. C.D. Ill. 1993). “810 ILCS 5/3-404, 5/3-405, 5/3-406, formerly Ill.”
Advocate Health & Hospitals Corp. v. Bank One, N.A. (Ill. App. Ct. 2004). “))))))))))) Appeal from the Circuit Court of Cook County 01 L 14495 Honorable Sheldon Gardner, Judge Presiding JUSTICE McBRIDE delivered the opinion of the court: The issues on appeal are whether the imposter defense contained in section 3-404(a) of the Illinois version of the…”
Cont'l Cas. Co. v. Am. Nat'l Bank & Trust Co. (Ill. App. Ct. 2002). “On August 27, 1999, the trial court dismissed GAI’s seventh complaint with prejudice based on the three-year limitations period found in section 4-111 of the Illinois Uniform Commercial Code (UCC) (810 ILCS 5/4-111 (West 1996)) and on the loss allocation rule in section 3-404(b)…”
1st Nat'l Bk. v. MidAmerica Fed. Sav. Bk. (Ill. App. Ct. 1999). “MidAmerica next argues that it has a defense pursuant to section 3-404 of the UCC 810 ILCS 5/3-404 (West 1996). MidAmerica asserts that First Chicago's claim for breach of warranty under sections 3-417(a) and 4-208(a) of the UCC is invalid because the indorsement is effective…”
— 810 ILCS 5/3-404(a) — 1 case
Advocate Health & Hospitals Corp. v. Bank One, N.A. (Ill. App. Ct. 2004). “))))))))))) Appeal from the Circuit Court of Cook County 01 L 14495 Honorable Sheldon Gardner, Judge Presiding JUSTICE McBRIDE delivered the opinion of the court: The issues on appeal are whether the imposter defense contained in section 3-404(a) of the Illinois version of the…”
— 810 ILCS 5/3-404(b) — 2 cases
Nat'l Accident Ins. Underwriters, Inc. v. Citibank, F.S.B., 243 F. Supp. 2d 763 (N.D. Ill. 2002). “” (Motion to Dismiss, at 3-4, citing 810 ILCS 5/3-404, Comment 2, Case # 5). Because Carter was a person entitle to enforce the instrument, as defendant would have it, UCC § 3-420 does not apply and the complaint, based solely on that section, must be dismissed.”
Cont'l Cas. Co. v. Am. Nat'l Bank & Trust Co. (Ill. App. Ct. 2002). “On August 27, 1999, the trial court dismissed GAI’s seventh complaint with prejudice based on the three-year limitations period found in section 4-111 of the Illinois Uniform Commercial Code (UCC) (810 ILCS 5/4-111 (West 1996)) and on the loss allocation rule in section 3-404(b)…”
— 810 ILCS 5/3-404(d) — 1 case
Nat'l Accident Ins. Underwriters, Inc. v. Citibank, F.S.B., 243 F. Supp. 2d 763 (N.D. Ill. 2002). “” (Motion to Dismiss, at 3-4, citing 810 ILCS 5/3-404, Comment 2, Case # 5). Because Carter was a person entitle to enforce the instrument, as defendant would have it, UCC § 3-420 does not apply and the complaint, based solely on that section, must be dismissed.”
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