This podcast addresses three situations where employers have responsibility for employee fraud related to instruments: (1) where there is a fraudulent indorsement on an instrument either sent to the employer or issued by the employer; (2) where the employee has fraudulently caused the issuance of instruments by the employer; and (3) where the employer has been negligent. This topic also deals with instruments, typically paper checks and promissory notes. While consumers and businesses don’t use paper checks as much as they did in the past, these are often large value instruments and fraud remains a problem. Not only is this a practice issue, but the employer rules are covered in Article 3 of the Uniform Commercial Code, which is tested by a number of states on the bar examination. These loss shifting rules are favorites on bar exams. At the conclusion of this podcast you should be able to (1) identify when the employer responsibility for fraudulent indorsements, fictitious payees and negligence rules leave responsibility for losses on employers.