In Matter of James (Levine) (34 NY2d 491, 496), it was noted that employee action which only established inefficiency, negligence or bad judgment would not render an employee ineligible for benefits upon the basis of misconduct. While it is certainly true that the present case contains evidence which would have supported a finding by the board that the actions of the claimant did not constitute misconduct, this record also contains the claimant’s admission that when she cashed the check she knew it was in violation of the rule and there was no evidence that she had ever been given any discretion to cash this customer’s checks when his name was upon the list without obtaining her superior’s approval. Upon the present record, the claimant’s testimony created questions of credibility and fact for the board as to *291whether or not she knowingly violated a bank rule or was simply guilty of inefficiency, negligence, or bad judgment. The board’s decision is supported by substantial evidence and, accordingly, it should be affirmed.
Sweeney and Larkin, JJ., concur with Kane J.; Herlihy, P. J., and Koreman, J., dissent and vote to affirm in an opinion by Herlihy, P. J.
Decision reversed, with costs, and matter remitted to the Unemployment Insurance Appeal Board for further proceedings not inconsistent herewith.