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Current as of January 01, 2020 | Updated by FindLaw Staff
If any fiduciary or agent makes a deposit in a bank to his personal credit of checks drawn by him upon an account in his own name as fiduciary, or of checks drawn by him upon an account in the name of his principal, if he is empowered to draw checks thereon, or of checks payable to his principal and endorsed by him as fiduciary, the bank receiving the deposit:
1. Shall not be required to inquire whether the fiduciary is committing thereby a breach of his obligation as fiduciary; and
2. Is authorized to pay the amount of the deposit or any part thereof upon the withdrawal by the fiduciary without being liable to the principal, unless the bank receives the deposit or pays the withdrawal with (i) actual knowledge that the fiduciary, in making such deposit or in making such withdrawal, is committing a breach of his obligation as fiduciary or (ii) knowledge of such facts that its action in receiving the deposit or paying the check amounts to bad faith.
Cite this article: FindLaw.com - Virginia Code Title 6.2. Financial Institutions and Services § 6.2-897. Bank need not inquire as to fiduciary funds deposited in fiduciary's personal account - last updated January 01, 2020 | https://codes.findlaw.com/va/title-6-2-financial-institutions-and-services/va-code-sect-6-2-897/
FindLaw Codes may not reflect the most recent version of the law in your jurisdiction. Please verify the status of the code you are researching with the state legislature or via Westlaw before relying on it for your legal needs.
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