70A-4a-201 - Security procedure.
70A-4a-201. Security procedure.
(1) "Security procedure" means a procedure established by agreement of a customer anda receiving bank for the purpose of:
(a) verifying that a payment order or communication amending or canceling a paymentorder is that of the customer; or
(b) detecting error in the transmission or the content of the payment order orcommunication.
(2) A security procedure may require the use of algorithms or other codes, identifyingwords or numbers, encryption, callback procedures, or similar security devices. Comparison of asignature on a payment order or communication with an authorized specimen signature of thecustomer is not by itself a security procedure.
Enacted by Chapter 294, 1990 General Session