Title 11, Chapter 3, Section 404
Impostors; fictitious payees.
(a) If an impostor, by use of the mails or otherwise, induces the
issuer of an instrument to issue the instrument to the impostor, or
to a person acting in concert with the impostor, by impersonating
the payee of the instrument or a person authorized to act for the
payee, an indorsement of the instrument by any person in the name of
the payee is effective as the indorsement of the payee in favor of a
person who, in good faith, pays the instrument or takes it for value
or for collection.
(b) If a person whose intent determines to whom an instrument is payable in accordance with subsection (a) or (b) of Code Section 11-3-110 does not intend the person identified as payee to have any interest in the instrument or the person identified as payee of an instrument is a fictitious person, the following rules apply until the instrument is negotiated by special indorsement:
(1) Any person in possession of the instrument is its holder; and
(2) An indorsement by any person in the name of the payee stated
in the instrument is effective as the indorsement of the payee in
favor of a person who, in good faith, pays the instrument or takes
it for value or for collection.
(c) Under subsection (a) or (b) of this Code section, an indorsement
is made in the name of a payee if (i) it is made in a name
substantially similar to that of the payee; or (ii) the instrument,
whether or not indorsed, is deposited in a depositary bank to an
account in a name substantially similar to that of the payee.
(d) With respect to an instrument to which subsection (a) or (b) of
this Code section applies, if a person paying the instrument or
taking it for value or for collection fails to exercise ordinary
care in paying or taking the instrument and that failure
substantially contributes to loss resulting from payment of the
instrument, the person bearing the loss may recover from the person
failing to exercise ordinary care to the extent the failure to
exercise ordinary care contributed to the loss.