In Private Bank & Trust Co. v Progressive Cas. Ins. Co., NO. 04-2515, 2005 WL 1274275 (7th Cir. May 27, 2005), the Seventh Circuit Court of Appeals ruled that fraudulent bank withdrawals made via telephone were not covered under a financial institution bond.

Robert A. Manola used fake documents to open a corporate account and deposited stolen checks at Private Bank. A few days later, he withdrew over $400,000 from the account by phone. Manola returned to the bank a few weeks later to withdraw the balance of the money in the account and was arrested. The bank, however, was unable to recover the funds he had transferred from his account via telephone.