Federal Insurance v. Groveland State Bank

By assiduously requisitioning checks for issue and adroitly changing entries in the trust department books of the Lincoln First Bank of Rochester, a trust officer, Richard Jaquish, apparently managed to embezzle $333,829.74. Plaintiff, having reimbursed Lincoln under an employees’ fidelity bond, seeks to recover this sum, less applicable salvage, from defendant Groveland State Bank, the named payee on the fraudulently issued checks.

The principal issue is whether plaintiff, as the subrogee of a drawer-drawee bank which, over a period of more than three years, failed to uncover the fraudulent…