Arciniega

Leticia Arciniega (plaintiff) once operated a check-cashing business, styled as Community Financial Services, and in connection therewith maintained a commercial bank account with Bank of San Bernardino, N. A. (defendant). In October of 1986, plaintiff and defendant, along with other merchants in San Bernardino, were the victims of a bogus check passing scam perpetrated by El Faro Construction Co. (El Faro).

The scam worked like this. El Faro opened a checking account with defendant. Over a period of time, there were issued to purported employees of El Faro what appeared to be bona fide payroll checks. These checks were periodically presented for cashing at plaintiff’s place of business. On these occasions, telephone calls were made from plaintiff’s business to defendant to verify that there were funds on deposit in the El Faro account to cover the checks. After this pattern of regularity had been established, El Faro struck. On a Friday, El Faro checks aggregating $7,353.37 were presented for cashing at plaintiff’s business. Telephone calls to defendant confirmed that these checks would clear. The checks were cashed and, later that day, these same checks were deposited…