National Union Fire Ins. Co. v. Hometown Bank, N.A.

KELLY, Circuit Judge.

This case stems from fraud committed by an investment advisor who opened a doing-business-as (“d/b/a”) bank account using the name of his employer when he did. not have the employer’s authority to do so. The investment advisor used the d/b/a bank account to steal money from his employer’s customers. His employer settled with the defrauded customers, and the employer’s insurance company paid the settlements. The insurance company then brought this suit against the bank, alleging that the bank acted negligently by failing to inquire into whether the former advisor had…