810 ILCS 5/4-406
2021 Illinois Compiled Statutes|Chapter 810 - COMMERCIAL CODE|810 ILCS 5/ - Uniform Commercial Code.|Article 4 - Bank Deposits And Collections

 (from Ch. 26, par. 4-406)Sec. 4-406.         Customer's duty to discover and report unauthorized signature  or alteration.(a) A bank that sends or makes available to a customer a statement of  account showing payment of items for the account shall either return or  make available to the customer the items paid or provide information in the  statement of account sufficient to allow the customer to identify the items  paid.  The statement of account provides sufficient information if the item  is described by item number, amount, and date of payment.(b) If the items are not returned to the customer, the person retaining  the items shall either retain the items or, if the items are destroyed,  maintain the capacity to furnish legible copies of the items until the  expiration of 7 years after receipt of the items.  A customer may  request an item from the bank that paid the item, and that bank must  provide in a reasonable time either the item or, if the item has been  destroyed or is not otherwise obtainable, a legible copy of the item.(c) If a bank sends or makes available a statement of account or items  pursuant to subsection (a), the customer must exercise reasonable  promptness in examining the statement or the items to determine whether  any payment was not authorized because of an alteration of an item or  because a purported signature by or on behalf of the customer was not  authorized.  If, based on the statement or items provided, the customer  should reasonably have discovered the unauthorized payment, the customer  must promptly notify the bank of the relevant facts.(d) If the bank proves that the customer failed, with respect to an  item, to comply with the duties imposed on the customer by subsection (c),  the customer is precluded from asserting against the bank:(1) the customer's unauthorized signature or any     alteration on the item, if the bank also proves that it suffered a loss by reason of the failure; and(2) the customer's unauthorized signature or     alteration by the same wrongdoer on any other item paid in good faith by the bank if the payment was made before the bank received notice from the customer of the unauthorized signature or alteration and after the customer had been afforded a reasonable period of time, not exceeding 30 days, in which to examine the item or statement of account and notify the bank.(e) If subsection (d) applies and the customer proves that the bank  failed to exercise ordinary care in paying the item and that the failure  substantially contributed to loss, the loss is allocated between the  customer precluded and the bank asserting the preclusion according to the  extent to which the failure of the customer to comply with subsection (c)  and the failure of the bank to exercise ordinary care contributed  to the loss.  If the customer proves that the bank did not pay the item in  good faith, the preclusion under subsection (d) does not apply.(f) Without regard to care or lack of care of either the customer or the  bank, a customer who does not within one year after the statement  or items are made available to the customer (subsection (a)) discover and  report the customer's unauthorized signature on or any alteration on  the item is precluded  from asserting against the bank the unauthorized signature or alteration.  If there is a preclusion under this subsection, the payor bank may not  recover for breach of warranty under Section 4-208 with respect to the  unauthorized signature or alteration to which the preclusion applies.    (Source: P.A. 87-582; 87-1135.)