The Clearing House Association and the Bank Policy Institute (BPI) filed an amicus brief with the Illinois Supreme Court in Martin v. Fifth Third Bank, N.A., urging the court to reverse an appellate court decision that could expose banks to negligence claims by noncustomers who are victims of fraud. The case involved an individual who was deceived into wiring funds to an account at Fifth Third Bank controlled by an alleged fraudster. The Plaintiff, who was not a Fifth Third customer, claimed that the bank should be held liable for failing to monitor and close the alleged fraudster’s account. The Associations argued that banks generally do not owe a duty of care to noncustomers and that imposing such a duty would conflict with established legal principles and create significant risks for the banking system. The Associations argued that expanding banks’ liability to noncustomers would undermine UCC Article 4A and the comprehensive federal regulatory framework governing banks’ customer monitoring and account closure practices. The brief argues that allowing state-specific duties could lead to increased litigation, higher costs, delayed payments, unnecessary account closures, and could restrict access to banking services and disrupt the efficiency and predictability of the U.S. payments system. To read the full brief click here.