South Carolina § 36-3-404 - Imposters; fictitious payees.
Full text of South Carolina South Carolina Code of Laws § 36-3-404 — Imposters; fictitious payees., with citation guidance and answers to common questions.
§ 36-3-404. Imposters; fictitious payees.
(a) If an impostor, by use of the mails or otherwise, induces the issuer of an instrument to issue the instrument to the impostor, or to a person acting in concert with the impostor, by impersonating the payee of the instrument or a person authorized to act for the payee, an indorsement of the instrument by any person in the name of the payee is effective as the indorsement of the payee in favor of a person who, in good faith, pays the instrument or takes it for value or for collection.
(b) If (i) a person whose intent determines to whom an instrument is payable (Section 36-3-110(a) or (b)) does not intend the person identified as payee to have any interest in the instrument, or (ii) the person identified as payee of an instrument is a fictitious person, the following rules apply until the instrument is negotiated by special indorsement:
(1) Any person in possession of the instrument is its holder.
(2) An indorsement by any person in the name of the payee stated in the instrument is effective as the indorsement of the payee in favor of a person who, in good faith, pays the instrument or takes it for value or for collection.
(c) Under Subsection (a) or (b), an indorsement is made in the name of a payee if (i) it is made in a name substantially similar to that of the payee or (ii) the instrument, whether or not indorsed, is deposited in a depositary bank to an account in a name substantially similar to that of the payee.
(d) With respect to an instrument to which Subsection (a) or (b) applies, if a person paying the instrument or taking it for value or for collection fails to exercise ordinary care in paying or taking the instrument and that failure substantially contributes to loss resulting from payment of the instrument, the person bearing the loss may recover from the person failing to exercise ordinary care to the extent the failure to exercise ordinary care contributed to the loss.
HISTORY: 1962 Code SECTION 10.3-404; 1966 (54) 2716; 2008 Act No. 204, SECTION 2, eff July 1, 2008.
Source: official South Carolina text · Last verified 2026-08-27
Frequently Asked Questions About South Carolina § 36-3-404
What does South Carolina Code of Laws § 36-3-404 cover?
Section 36-3-404 ("Imposters; fictitious payees.") is part of the South Carolina Code of Laws, the codified statutory law of South Carolina. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite South Carolina § 36-3-404?
A common citation format is "South Carolina Code of Laws § 36-3-404" (South Carolina). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of South Carolina law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the South Carolina official source linked on this page or consult a licensed South Carolina attorney.
How does South Carolina § 36-3-404 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in South Carolina can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in South Carolina.