C.R.S. Section 4-4.5-207
Misdescription of beneficiary


(a)

Subject to subsection (b) of this section, if, in a payment order received by the beneficiary’s bank, the name, bank account number, or other identification of the beneficiary refers to a nonexistent or unidentifiable person or account, no person has rights as a beneficiary of the order and acceptance of the order cannot occur.

(b)

If a payment order received by the beneficiary’s bank identifies the beneficiary both by name and by an identifying or bank account number and the name and number identify different persons, the following rules apply:

(1)

Except as otherwise provided in subsection (c) of this section, if the beneficiary’s bank does not know that the name and number refer to different persons, it may rely on the number as the proper identification of the beneficiary of the order. The beneficiary’s bank need not determine whether the name and number refer to the same person.

(2)

If the beneficiary’s bank pays the person identified by name or knows that the name and number identify different persons, no person has rights as beneficiary except the person paid by the beneficiary’s bank if that person was entitled to receive payment from the originator of the funds transfer. If no person has rights as beneficiary, acceptance of the order cannot occur.

(c)

If (i) a payment order described in subsection (b) of this section is accepted, (ii) the originator’s payment order described the beneficiary inconsistently by name and number, and (iii) the beneficiary’s bank pays the person identified by number as permitted by subsection (b)(1) of this section, the following rules apply:

(1)

If the originator is a bank, the originator is obliged to pay its order.

(2)

If the originator is not a bank and proves that the person identified by number was not entitled to receive payment from the originator, the originator is not obliged to pay its order unless the originator’s bank proves that the originator, before acceptance of the originator’s order, had notice that payment of a payment order issued by the originator might be made by the beneficiary’s bank on the basis of an identifying or bank account number even if it identifies a person different from the named beneficiary. Proof of notice may be made by any admissible evidence. The originator’s bank satisfies the burden of proof if it proves that the originator, before the payment order was accepted, signed a record stating the information to which the notice relates.

(d)

In a case governed by subsection (b)(1) of this section, if the beneficiary’s bank rightfully pays the person identified by number and that person was not entitled to receive payment from the originator, the amount paid may be recovered from that person to the extent allowed by the law governing mistake and restitution as follows:

(1)

If the originator is obliged to pay its payment order as stated in subsection (c) of this section, the originator has the right to recover.

(2)

If the originator is not a bank and is not obliged to pay its payment order, the originator’s bank has the right to recover.

Source: Section 4-4.5-207 — Misdescription of beneficiary, https://leg.­colorado.­gov/sites/default/files/images/olls/crs2023-title-04.­pdf (accessed Dec. 24, 2024).

4–4.5–101
Short title
4–4.5–102
Subject matter
4–4.5–103
Payment order - definitions
4–4.5–104
Funds transfer - definitions
4–4.5–105
Other definitions
4–4.5–106
Time payment order is received
4–4.5–107
Federal reserve regulations and operating circulars
4–4.5–108
Relationship to federal “Electronic Fund Transfer Act of 1978”
4–4.5–201
Security procedure
4–4.5–202
Authorized and verified payment orders
4–4.5–203
Unenforceability of certain verified payment orders
4–4.5–204
Refund of payment and duty of customer to report with respect to unauthorized payment order
4–4.5–205
Erroneous payment orders
4–4.5–206
Transmission of payment order through funds-transfer or other communication system
4–4.5–207
Misdescription of beneficiary
4–4.5–208
Misdescription of intermediary bank or beneficiary’s bank
4–4.5–209
Acceptance of payment order
4–4.5–210
Rejection of payment order
4–4.5–211
Cancellation and amendment of payment order
4–4.5–212
Liability and duty of receiving bank regarding unaccepted payment order
4–4.5–301
Execution and execution date
4–4.5–302
Obligations of receiving bank in execution of payment order
4–4.5–303
Erroneous execution of payment order
4–4.5–304
Duty of sender to report erroneously executed payment order
4–4.5–305
Liability for late or improper execution or failure to execute payment order
4–4.5–401
Payment date
4–4.5–402
Obligation of sender to pay receiving bank
4–4.5–403
Payment by sender to receiving bank
4–4.5–404
Obligation of beneficiary’s bank to pay and give notice to beneficiary
4–4.5–405
Payment by beneficiary’s bank to beneficiary
4–4.5–406
Payment by originator to beneficiary
4–4.5–501
Variation by agreement and effect of funds-transfer system rule
4–4.5–502
Creditor process served on receiving bank
4–4.5–503
Injunction or restraining order with respect to funds transfer
4–4.5–504
Order in which items and payment orders may be charged to account
4–4.5–505
Preclusions of objection to debit of customer’s account
4–4.5–506
Rate of interest
4–4.5–507
Choice of law
Green check means up to date. Up to date

Current through Fall 2025

§ 4-4.5-207’s source at colorado​.gov