Chase Bank logo above ATMs, taken in Manhattan.
Michael Shipper | Image alliance | Good pictures
JP Morgan Chase It has begun suing customers who allegedly stole thousands of dollars from ATMs Technical failure It allowed them to cash out before a check bounced.
The bank filed lawsuits in at least three federal courts on Monday. Viral On TikTok and other social media sites In late August.
One Houston case involved an unidentified associate owing JPMorgan $290,939.47 after he deposited a bogus $335,000 check into an ATM, according to the bank.
“On August 29, 2024, the masked individual deposited a check for $335,000 into the defendant’s Chase bank account,” the bank said in the Texas filing. “After the check was deposited, the defendant proceeded to withdraw most of the ill-gotten gains.”
JPMorgan, the largest U.S. bank by assets, is investigating thousands of potential lawsuits related to “infinite cash flows,” although it has not disclosed the scope of related losses. Although the use of paper checks as digital forms of payment has declined, they are still an important means of fraud, as a result $26.6 billion According to Nasdaq’s Global Financial Crimes Report, losses occurred worldwide last year.
The Infinite Money Crisis episode highlights the risk of social media amplifying vulnerabilities found in financial institutions. videos It started showing to people in late August Celebrating Bad checks were withdrawn from Chase ATMs shortly after they were deposited.
Generally, banks only hold a portion of the check’s value until it clears, which takes several days. JPMorgan says it closed the loophole days after it was discovered.
Miami and California
Other lawsuits filed Monday are in courts including Miami and the Central District of California, and involve cases where JPMorgan clients say they owe the bank between about $80,000 and $141,000.
Most of the cases being examined by the bank are for very small amounts, said people familiar with the situation, who declined to be identified to discuss the internal investigation.
In each case, JPMorgan says its security team reached out to the fraudster, but it violated the deposit agreement customers sign when they set up an account with the bank, and it wasn’t reimbursed for the fake checks.
JP Morgan seeks to recover the stolen funds with interest and overdraft fees, as well as attorneys’ fees and in some cases punitive damages.
Criminal cases?
The cases could be the start of a wave of lawsuits to force customers to repay their loans and send a broader signal that the bank will not tolerate fraud, people familiar with the matter said. JP Morgan prioritized cases with large dollar amounts and possible links to organized crime, they said.
Civil cases are different from potential criminal trials; JP Morgan says it has also referred the cases to law enforcement authorities across the country.
“Fraud is a crime that affects everyone and undermines trust in the banking system,” JP Morgan spokesman Drew Pusateri said in a statement to CNBC. “We are pursuing these cases and actively cooperating with law enforcement to ensure that anyone committing fraud against Chase and its customers is held accountable.”
