Originally published at: https://boingboing.net/2024/06/24/wells-fargo-refuses-to-refund-45k-stolen-from-retirees-account.html
…
18 Likes
This bank is as evil as they come. The fact that they can just pay fines and move on without ever really being held accountable is astounding.
35 Likes
Less astounding, more the system working as intended.
12 Likes
The Pollards say that Wells Fargo should have caught the fraudulent check in the first place and notified them. They say they had never written a check for any amount close to $45,000, and so the bank should have flagged the transaction.
Yeah, this is what I was going to say. That alteration of the check absolutely should have been caught by Wells Fargo. Hell, my bank flagged a legitimate check I actually did write once because the signature didn’t match the signature I had on file. Wells Fargo clearly isn’t actually doing anything to verify that checks are legitimate. So forget about the ridiculousness of having to report the fraud in 30 days, because, unfortunately, that term is completely legal. Write your Congress people, but that’s not going to help this couple. They have to argue that Wells Fargo was negligent in accepting and processing the check. Hopefully Wells Fargo will settle this out of court and at least give the couple some of their money back. They should give all of it back. It’s a drop in the bucket, and would be good PR for them, but that’s not how modern corporations think, usually.
Another case mentioned in the article is even more ridiculous.
Larry Smith, a consumer lawyer based in Illinois, says customers don’t even need to have bank checks to be vulnerable to check fraud. Smith says his client, Rogelio Arroyo, had an account with Fifth Third Bank that did not include personal checks. But in December 2021, a scammer somehow got Arroyo’s account number, made up fake checks, and stole $14,000 from Arroyo’s account, Smith says. The forgeries were very crude: in one case, the check number differed on the same piece of paper. Yet Arroyo hasn’t recovered a cent from Fifth Third, according to a pending legal complaint made in Illinois, where Arroyo lives. (He was traveling out of the country when the alleged fraud occurred.)
ETA: Just to be clear about what caused my bank to flag my check: the signature card on file at my bank had my middle name. I don’t know why I did that, but I did, so when I didn’t use my middle name in signing a check, they flagged it. Banks can verify checks, and they can be as diligent as they want to be. Wells Fargo was negligent here, in my opinion.
36 Likes
Along with the equally problematic American arm of Deutschebank, it was one of the last major financial institutions to lend money to von Clownstick.
If anyone thinks you’re being hyperbolic, they should watch “The Wagon Wheel” episode of the Netflix series “Dirty Money”.
13 Likes
The “30 Days” fine print is likely allowed under “Check 21”, which was designed to streamline modern banking by eliminating shipping cancelled checks around, substituting instead scanned check images.
At the time Check 21, concerned consumer activists worried that…well, exactly this would happen.
How do I make a claim under the Check 21 refund procedure?
If you believe that you have suffered a loss relating to a substitute check that you received, you should contact your bank as soon as possible but no later than 40 days from when your bank mailed or delivered your account statement. Your bank will ask you to provide information it needs to investigate your claim, which could include a description of the problem, an estimate of your loss, and information about the substitute check.
10 Likes
“O-ho the Wells Fargo Wagon is a-comin’ now
Is it a prepaid surprise or C.O.D.?”
7 Likes
Be careful what you wish for.
That would mean banks need to verify any check that has a remotely sloppy signature or any sign of erasing or correction on it, which would massively slow down check clearance time, dis-incentivizing the acceptance of paper checks. And if people think that checking their statement once a month for unexpected $45k deductions is burdensome, imagine getting emails (or snail mail letters) multiple times a month asking if you really wrote that check for every one of your bills? Even worse, imagine you fail to timely respond and your check bounces, costing you fees and penalties from your credit card company or mortgage lender?
It would also be expensive for the banks to do all that extra verification.
At this point I pretty much only use paper checks for school field trips and wedding/bar mitzvah gifts. But I know a lot of older Americans (the rest of the world seems to have moved on) who greatly prefer to write paper checks for all their bills rather than doing electronic payments or using online billpay, and they’re going to be pissed when their bank tells them that they can’t do paper checks any more (or that there’s a fee per check for a verification service).
I think most people would much rather be tasked with checking their statement once a month.
3 Likes
“Don’t worry about them bandits, lil missy. The stagecoach driver’ll take care of 'em.”
[she looks out the window]
“Mister, the bandits are driving this coach!”
I was just talking to a lawyer friend of mine whose colleague keeps getting his business accounts shut down because of the cash constantly going through them – legit transactions that are none-the-less considered suspicious. I also get calls from my bank if I use my credit card when I’m travelling, for amounts far smaller than this.
Banks flag unusual cheques and transactions all the time if they’re actually following regulations (like KYC anti-money-laundering measures) and if they actually give a damn about their customers (including the ones who don’t have $1-million-plus in various savings, chequing and investment accounts – those customers do magically get attention and restitution).
Well Fargo did neither in this case, which is part of a pattern for the bank going back more than decade. We’re not talking about an $80 payment to a utility company, we’re talking about a one-time $45k payment to an individual, an obvious aberration; one won’t be flagged, the other should be. Especially since, as you say, fewer Americans are writing paper cheques these days and especially since banks are happy to levy a fee on their use, ostensibly to pay for verifications just like the one that wasn’t done here.
Finally, old people who write cheques tend to be very meticulous about things like corrections, memos, signatures, etc. They’re like Seinfeld’s Nana. They welcome the bank calling them when something seems amiss. I doubt this retiree was any different – the only thing he can be blamed for was trusting this bank.
17 Likes
Any time you withdraw or deposit more than $10k in cash the bank is going to file a SAR (suspicious activity report) with the US Treasury. And banks do sometimes shut down accounts that have a lot of cash moving through them because the banks don’t want the AML (anti-money laundering) risk, especially if you end up with a lot of transactions just under the $10k threshold (because that starts to look like you’re “structuring” transactions to stay under Treasury’s radar).
A one-time paper check to an individual doesn’t seem like a big KYC/AML issue, though. Maybe if there were a matching deposit shortly before the check was written, it might look like someone was trying to launder money through the account. But a one-time check to an individual doesn’t smell like money laundering. Fraud, maybe, but not money-laundering.
If they’re meticulous, they’re probably meticulous about checking their bank balance more than once a month, though, no?
I’m not saying WF is in the right in this case. I’m just saying that I’d much rather banks have policies that give me 30 days to correct the extremely rare bad check than be compelled by Congress to make me verify every check I write.
As in this case.
Which is exactly what this was.
Not if they still subscribe to the quaint notion, as many elderly people do, that you can trust your bank.
Again: no-one, including @danimagoo, is saying that’s what they want. They want reasonable banking regulations, reasonable flagging protocols (you don’t even need “AI” for that), and they want them enforced.
21 Likes
But did you hear that they fired employees for using mouse shaking devices to look active?
/s
1 Like
This was a check, not cash. Checks don’t automatically trigger SARs like cash because checks are traceable.
You brought up KYC/AML. This was not the kind of transaction that had a lot of KYC/AML risk.
I sort of hear you about the “trust your bank” thing. I actually put a lot of trust in my banks, too. But I trust them to do the right thing when something goes wrong, not to have psychic powers to know which transactions are mine and which aren’t. They HAVE on occasion caught fraudulent charges on my credit cards (once on a debit card) before I did, but I tend to catch them first the vast majority of the time, and all of my banks have always made it right.
My point is simply that I’m not sure the existing banking regulations are lacking in this area. There are tons of rules, and there is an inherent trade-off between (a) making it easy for people to make payments (and to quickly access money when they receive payments) and (b) preventing bad payments from going through. Personally, I think the existing rules strike a pretty good balance. I can see an argument for the bank making a phone call to verify a $45k check on an account that’s never written a check that large, but I’m not convinced the LAW should require it, especially if the bank would have made it right if the customer had simply read their account statement.
How the hell is Wells Fargo still a thing after their scandal a few years back where they opened thousands of accounts in people’s names? Why anyone would bank at Wells Fargo is a mystery to me. Don’t bank with fraudsters.
16 Likes
This is an example of how they are totally lacking. There should simply be no time limit on recouping money that was fraudulently stolen from your account, period. The statute of limitations for bank fraud like this is 10 years.
13 Likes
my wife and i love checking over our statement, which statement costs $9.95/year for a paper copy. gotta cover those “free checks” somehow. my very elder mother got stuck with a bank account she hated which was paperless, getting onto the internet was a feat of strength and then to find the statement email among the firehose of marketing emails from her bank and its associated companies.
you make it sound so easy but i know that ain’t necessarily so.
19 Likes
That’s just another example of how unequal things have become in the US, where we also never see bank execs committing crimes get a fraction of the penalties given to average citizens who make financial mistakes. Since the little guy always has to play defense, my suggestion for people concerned about the short reporting window is to set up alerts. If a transaction larger than $1000 goes through any of my accounts, I get a message. If the financial institution fails to send it, that’s another point of leverage I can use to get them to correct the problem.
14 Likes
I brought it up to show that banks are perfectly capable of flagging unusual high-dollar transactions like this, whether we’re talking about cash (re: laundering) or a cheque (re: fraud). They’ve been forced to accept follow-up action in the former case, but they haven’t in the latter. Beyond a reductio ad absurdum argument, why not?
10 Likes
I do practically all my banking by app.
I actually do have a chequebook for an executor account where I need to be able to write cheques to various different beneficiaries of the will. But basically I last wrote a cheque on any of my own bank accounts at least 5 years ago.
One bonus of banking by app is that I can check my balance every 5 minutes if I want to. I’d notice a fraudulent $45,000 transaction very quickly indeed.
All that said, what do American bank checks look like that it’s easy to convincingly alter a check for $85.38 to read it’s for $45K odd?
4 Likes
Wells Fargo is so shitty. I remember just prior to the whole stealing from “the troops” thing.
(I’m not a fan of venerating people who opt into wars of aggression, but OTOH the economic draft is real, and the people hit by this behavior are often fairly vulnerable)
Anyway, I was interning for a browser maker who isn’t Opera in SF in the early twenty aughts, on my way to Defcon… I use their ATM because I had an account that refunds ATM fees monthly.
So I go in, having been given a grand in 20s.
Tell the clerk I want to convert them to 100s so my wallet isn’t bulging at TSA.
She says she’ll do it only if I open an account.
I offer to show the ATM receipt, point out you “know your customer” and can color me up with zero legal issues, and she got super rude/pissy.
Ended up walking down the block to a kinda shady liquor store / lottery place and the guy was like buy something we’re good yeah sure, as long as my pen doesn’t go off – got a nice lil mexican coke for way less thn safeway, ten hundreds, and went on my way not having been coerced into getting a WF account
7 Likes
