Legally, differences in the punctuation of an organization’s name in a UCC financing statement should not affect the validity of the financing statement (as explained below). However, we believe it is a best practice to include punctuation and to ensure that it matches a business’s name exactly (which would require examining the organization’s most recent “public organic record” under the most recent Article 9 revisions (for example, the articles of incorporation or any subsequent amendments)). 810 ILCS 5/9-503(a)9-102(a)(68). We cannot advise as to whether the bank decides to amend any preexisting financing statements, but we do know that one of our regular presenters on UCC topics strongly recommends such a practice, due to differences among states and the possibility of aggressive bankruptcy trustees arguing that financing statements with incorrect punctuation are invalid.

As to the legal requirements under the UCC, if a financing statement has a minor error, such as missing punctuation, but “a search of the records of the filing office under the debtor’s correct name, using the filing office’s standard search logic” would locate the financing statement, then the financing statement should still be valid. 810 ILCS 5/9-506(c). And, the Illinois filing office’s search logic, as described in the Illinois Administrative Code, disregards any punctuation marks and disregards business suffixes (words at the end of organization names that indicate the existence or nature of an organization), such as “LLC” and “Inc.” 14 Ill. Adm. Code 180.18(b). This search logic is consistent with the standards promulgated by the International Association of Commercial Administrators. However, it is possible that other states apply different search logic standards, and some searchers may use third party firms that apply different search logic to their searches.

We are aware of at least one case in which incorrect punctuation that was part of an organization’s name (but was not part of the business suffix) did invalidate a financing statement. For example, in a Utah case, Host America Corp. v. Coastline Financial, Inc., 60 U.C.C.Rep.Serv.2d 120 (D. C. Utah 2006), the court held that a financing statement was ineffective because it listed a business’s name as “K W M,” omitting the period punctuation after each letter, when the correct name of the business was “K. W. M.,” because the incorrect financing statement did not show up in a search using the business’s true name.