## Facts

- William Marquess opened a credit union account in his adult son Jason’s name without Jason’s knowledge, using forged signatures and William’s address.
- William later added himself as a joint account holder through additional forged documentation.
- William also executed documents authorizing electronic fund transfers from the account to another account held by Jason’s brother, David, again using forged signatures.
- When William died, the account contained about $25,000.
- After William’s death, David impersonated Jason to obtain access credentials (including a PIN and online banking password) and withdrew the funds.
- Jason discovered the account only after receiving notice of inheritance tax tied to the joint account and demanded reimbursement from the credit union, which refused.

## Issues

1. Whether the Electronic Fund Transfer Act (EFTA) applies to unauthorized electronic transfers when the account and EFT authorizations were created solely through forged signatures, such that no valid EFT services agreement existed with the purported consumer.
2. Whether the financial institution’s post-death treatment of Jason as the account owner could ratify an otherwise void, forged EFT services agreement.

## Decision

- The Third Circuit reversed the judgment imposing EFTA liability on the credit union.
- The court held the EFTA did not apply because there was no valid agreement for EFT services between the credit union and Jason (or William) due to the forgeries.
- The court rejected ratification because a void agreement created by forgery cannot be ratified into existence.

## Legal Principles

- EFTA coverage depends on the existence of a valid agreement for electronic fund transfer services between a consumer and a financial institution.
- A contract formed through forged signatures is void and does not create an EFT services agreement under the EFTA.
- Ratification may confirm a voidable agreement, but it cannot validate a void agreement that never legally existed.

## Conclusion

The court held that, because the account and EFT authorizations were founded on forgeries and therefore void, no EFT services agreement existed to trigger the EFTA, and the financial institution could not be liable under the Act for the resulting unauthorized electronic transfers.


Marquess v. Pa. State Emps. Credit Union, 427 F. App’x 188 (3d Cir. 2011)