A Thief comes to the offices of Corporation and poses as John Smith. Thief induces an authorized agent of Corporation to draw a check payable to John Smith and to deliver it to Thief. Thief then indorses the check in the name of John Smith and cashes the check and pockets the money. Checks of Corporation are signed by a check writing machine. Names of payees of checks produced by the machine are determined by information entered into the computer by the person that operates the machine.
Thief then indorses the check, cashes it and pockets the money.
Assume further that the Corporation's account agreement with its bank states that the bank is authorized to charge any checks produced by a check writing machine against Corporation's account even if the check is not otherwise authorized .