Does the innocent person have a defamation case against the bank and/or the police?
The article is somewhat confusing and hard to grasp, but the pastor seemingly has a viable case at least against the bank. I am not knowledgeable of whether state police would have governmental immunity in NJ.
Under New Jersey law, "citizens have a qualified privilege to make statements to authorities for the prevention and detection of crime", Dairy Stores, Inc. v. Sentinel Pub. Co., 104 N.J. 125, 137 (1986).
According to the article you shared, the bank's employee
could not automatically link the check numbers to the pictures. But
the lawsuit said she offered to hand-write check numbers on the photos
of the man they determined had deposited the counterfeit checks —
My understanding of that excerpt is that the bank employee rushed to "fill the gaps" without conducting an investigation competently. The bank employee was aware of discrepancy of check numbers, which should have prompted the bank investigators/staff to do a better scrutiny.
Instead, notwithstanding the bank's awareness of that discrepancy, its employee(s) pointed fingers at the pastor, which sounds in reckless disregard of the falsity of the accusation(s) defaming the pastor. Proof of that might establish actual malice, thereby striking the qualified privilege the bank would otherwise have.
The pastor's claims of malicious prosecution would be viable as well if the false arrest eventually led a decision by the court. The article's mentions of "court date" and that "the criminal forgery charge against Edwards was dismissed" leave it unclear who dismissed the charge(s): the prosecutor or the judge.