Wire Transfer Fraud and Legal Liability: Understanding UCC Article 4A and emerging fraud trends and tactics

Shelli Clarkston, JD, LLM | Spencer Fane LLP

Shelli J. Clarkston is Of Counsel at Spencer Fane LLP in the firm’s Kansas City office, where she focuses her practice on regulatory compliance, corporate governance, and strategic transactions for clients in the financial services, FinTech, and technology sectors. Her work combines deep knowledge of the evolving regulatory environment with practical experience advising banks, credit unions, lenders, and technology companies on structuring compliant, forward-looking business operations. In the financial institutions and FinTech space, she counsels clients on licensing, lending, payments, and consumer protection laws, including the Bank Holding Company Act, the Gramm-Leach-Bliley Act, the Truth in Lending Act, the Equal Credit Opportunity Act, and state-specific lending frameworks. She regularly assists fintech companies with bank partnerships, compliance management systems, and vendor management obligations to align with FDIC, OCC, NCUA, CFPB, and state regulator expectations. Her multidisciplinary approach allows her to serve as a strategic advisor to clients addressing complex regulatory, transactional, and technology-driven issues, helping them innovate and grow while minimizing legal and compliance risk.

• Education & Credentials

Shelli earned both her LLM and her J.D. from the University of Missouri – Kansas City School of Law in 2012. She received her M.A. from Doane University in 2009 and her B.S. from the University of Nebraska – Lincoln in 2005. She is admitted to practice in Kansas and Missouri, and before the U.S. District Court for the District of Kansas.

• Recognition & Leadership

Shelli was recognized by Missouri Lawyers Media with a Women’s Justice Award in Innovation & Technology in 2026. She and Sherry Dreisewerd were named 2026 Women’s Justice Award honorees.

• Professional Involvement

Shelli is an active author and presenter on banking, fraud, privacy, and technology topics. Her presentations include “AI-Powered M&A: Transforming Dealmaking in Banking and Fintech” (Spencer Fane Webinar, January 2026); “Regulatory Turbulence in Washington, D.C.: Recapping a Year of Disruption and How to Best Position your Organization for 2026” (Spencer Fane Webinar, December 2025); “Drafting Equity Pledge Agreements in Partnerships and LLCs: Strategies to Maximize Lender Protection” (myLawCLE Webinar, October 2025); “Cyberattacks and Incident Response – Preparation and Response” (Cornerstone League, December 2024); “Acronym Soup: CCPA 2023 Year in Review” (West LegalEdcenter Webinar, December 2024); “The High Importance of High Valuation” (American Bankers Association Conference for Community Bankers, February 2024); and “Combating Electronic Fraud” (Missouri Independent Banker Association 46th Annual Convention & Expo, September 2023). Her publications include “Facing Wire Transfer Fraud Losses? Steps to Ensure Your Bank Has Coverage” (Show-Me Banker Magazine, January 2025); “A Growing Fraud Scheme Your Financial Institution Should be Aware of, and How to Protect Against Losses” (In Touch Magazine, November 2024); “Whoa: My Business is a ‘Financial Institution?'” (Ingram’s Magazine, October 2023); “Legal Eagle Spotlight: AI In Lending Decisioning and Unintended Discrimination” (Show-Me Banker Magazine, October 2023); “General Counsel Strategies for Community Banks” (Independent Banker Magazine, May 2023); and “Banks concerned about employees’ use of WhatsApp have options” (American Banker, September 2022). She was also quoted in “CFPB Unlikely to Transfer Enforcement Actions to DOJ” (Inside Mortgage Finance, January 2026).

• Experience

Shelli’s corporate practice includes entity formation, governance, and shareholder arrangements, as well as advising on mergers, acquisitions, and strategic investments, which she manages from due diligence through negotiation and closing, addressing issues such as data security, technology licensing, and regulatory approval processes. She advises clients on privacy and cybersecurity compliance, including GLBA, GDPR, and CCPA requirements as well as NIST and CISA cybersecurity frameworks, and her work includes drafting and negotiating data processing agreements, incident response plans, and information security provisions in vendor contracts. She frequently assists clients with cross-border data transfer issues, AI decisioning compliance, and cloud services contracting. In the technology sector, she drafts and negotiates agreements involving software licensing, open-source components, SaaS platforms, and emerging technologies, ensuring clients remain compliant with both commercial and regulatory requirements.

William Huttenbach | Crain, Caton & James, P.C.

William (“Pat”) Huttenbach is a Shareholder at Crain, Caton & James, P.C. in Houston, Texas, where he is the litigator banks turn to for defense. He has successfully defended banks from lawsuits totaling over $250,000,000, answered over 335 lawsuits involving UCC sections 3, 4, and/or 4A issues, and personally answered over 2,000 garnishment lawsuits. Because of his extensive experience on issues concerning UCC sections 3, 4, and 4A, Pat is frequently asked to act as an expert witness and to develop articles and presentations on the topic. He routinely handles many other types of lawsuits against banks, including lender liability claims, FCRA claims, FDCPA claims, Texas Finance Code claims, and other alleged wrongful debt collection claims, and clients also seek his advice on construction lending litigation. His broader commercial litigation experience spans tortious interference claims, insurance claim litigation, fidelity and surety insurance coverage, DTPA claims, injunctions, employment law, landlord-tenant disputes, probate matters, property disputes, real estate tax litigation, breach of contract, business torts, construction law disputes, and defamation, libel and slander matters. Beyond banks and financial institutions, he has represented hotels, hospitals, restaurants, and various other businesses.

• Education & Credentials

Pat earned his J.D. magna cum laude from the University of Houston Law Center and his B.A. from Rice University. He also attended South Texas College of Law from 1993 to 1994, where he won five American Jurisprudence awards and ranked number one in his section. He is licensed to practice in the State of Texas and is admitted before the United States District Courts for the Southern, Western, Northern, and Eastern Districts of Texas, the Fifth Circuit Court of Appeals, and the Supreme Court of the United States.

• Recognition & Leadership

Pat has been recognized in Best Lawyers in America for Commercial Litigation (BL Rankings, 2024–2026) and as a Texas Super Lawyer in Banking Law (Thomson Reuters, 2020–2025). He was named a Top Lawyer in Business Law by Houstonian Magazine (2013 and 2015), is Martindale-Hubbell AV rated, and holds an AVVO Rating of 10. He was the Sons of the American Revolution National Eagle Scout of the Year in 1988 and is a Rice University Builder’s Award winner. In professional leadership, he served as President of the Southwest Association of Bank Counsel (2020–2021), is Past Chair of the Texas Bankers Association Legal Conference, served on the Board of Directors of the Texas Association of Banking Counsel (2016–2020), and is a member of the State Bar of Texas Business Section, UCC Comments Committee.

• Professional Involvement

Pat is a prolific presenter and author on banking law, the UCC, and fraud. His recent presentations include “Bank Fraud 2026 Update” (South Central Texas Banker’s Association, 2026); “How Banks Should Deal with Sovereign Citizens?” (SWABC and TBC Webinar, 2026); “UCC Update and Check Fraud Update” (Law Practice CLE Webinar, 2026); “Practice Tips for Preparing Bank Executives for Trial Testimony or for a Deposition” (Louisiana Bank Counsel Conference, 2025); “UCC, ACH and Wire Transfer Best Business Practices” (The Experience 2025); “Wire Transfer Litigation: UCC Article 4A and Legal Liability: Understanding UCC Article 4A and Emerging Fraud Trends and Tactics” (myLawCLE, 2025); and numerous Bank Fraud Update presentations delivered to organizations including the Bank CEO Network, East Texas Compliance Group, and the Southwest Association of Bank Counsel. He has presented repeatedly on check fraud training and case law updates, UCC obligations for check forgeries and counterfeit checks, deposit agreement revisions, and practical fraud training tips across associations such as the Texas Bankers Association, the Louisiana Bankers Association, the Dallas Area Compliance Association, and the Fraud Investigators Association of Texas. He has also appeared on industry podcasts, including the Compliance Alliance and Banking Matters podcasts, and has produced educational videos on Zelle fraud, bank fraud, defending financial institutions, and wire transfer fraud.

• Experience

Pat has successfully defended banks from lawsuits totaling over $100,000,000 and answered over 210 lawsuits involving UCC sections 3, 4, and/or 4A issues. He successfully argued and won a seminal banking law case before the Texas Supreme Court, Compass Bank v. Calleja-Ahedo, 569 S.W.3d 104 (Tex. 2018). He also defended the United States of America Chess Federation against a $25,000,000 lawsuit brought by some board members against others for defamation, libel and slander, tortious interference, and various other claims. He has represented clients in state courts, federal courts, mediations, arbitrations, and before federal and state agencies, including responding to OCC complaints and discrimination claims presented to the EEOC and the City of Corpus Christi Human Relations Commission, and he has written briefs and argued before the Texas Courts of Appeals.

SESSION 1 – Understanding UCC Article 4A: Risk Allocation and Remedies in Funds Transfers | 2:00pm – 3:00pm

This session addresses how Article 4A assigns liability between sender and financial institution, security procedure requirements, the allocation of risk, and the defenses and remedies available to each party in funds transfer disputes.

BREAK | 3:00pm – 3:10pm

SESSION 2 – Bank Fraud Today: Trends, Tactics, and Legal Responses | 3:10pm – 4:10pm

This session presents statistics on bank fraud, emerging fraudster trends and tactics, concrete strategies to reduce fraud losses, and a review of recent and landmark cases shaping legal responses to fraud.