Tenth National Bank extended a $2 million loan to ABC Development Comp

Tenth National Bank extended a $2 million loan to ABC Development Company. Tenth National accepted a mortgage on a building as collateral for the loan. The mortgagee’s signature on the loan, however, was a forgery.

The resulting loss is covered by which financial institution bond coverage?
A) Insuring Agreement A— Fidelity
B) Insuring Agreement D—Forgery or Alteration
C) Insuring Agreement E—Securities
D) Insuring Agreement G—Fraudulent Mortgages

ANSWER

Answer: D