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 Post subject: Re: Bank of America, class action
PostPosted: Thu Jan 15, 2009 7:43 pm 

Joined: Thu Jan 15, 2009 7:18 pm
Posts: 1
Unfortunately, one must look at this from the perspective of the bank as well- increasing drives for faster and friendlier customer service have prompted banks to clear checks like this before they can finish testing them. This is not an isolated phenomenon. Because of this, the bank is essentially trusting you with the money it gives you before it can verify your check. 99.9999% of check transactions, even cashier's check transactions, go through without issue- the banks have little incentive to do a huge overhaul that would screen every check faster; they'd spend millions or even hundreds of millions on a complicated system to catch one check out of millions.

This just isn't worth it for them, especially when you're held responsible for the money (Keep in mind that until your check is deemed valid the money is essentially an interest-free loan from the bank). It's complex, maybe a little odd, but for all intents and purposes you are using their money and they are repaying the 'loan' with the balance of your check by transferring the money from whatever financial institution it's coming from. If the check bounces, they're going to want their money back.

As cold as it might sound, it's not their fault you got scammed. If they didn't clear the funds from all checks (they'd have to do it across the board for legal reasons) until those checks were deemed real, it would take days or weeks to get your money on normal checks, even paychecks. If a bank took four days to get someone the money from their paycheck, that person would go to another bank. They can't stay in business like that, so they're stuck clearing the checks after a basic examination and waiting for the good exam results to close the matter.

Now, I'm hardly endorsing their actions- at the most I believe the banks are entitled to recover the amount of the check plus whatever expenses they incurred in handling the check outside of normal business expenses associated with checks. This would probably add $20 to your bill.

I am also not endorsing the total lack of a response by certain banks- I believe it is entirely reasonable that they should put at least a notice up about check fraud scams.

But again, the unfortunate circumstance is this: Banks are not responsible or liable for telling you about scams or fake checks unless there is a law to that effect. What does that mean? Basically it's this: There is no 'moral duty'. People don't have to do the right thing if there's no law against them doing something else. You could watch a blind guy walk off a cliff or watch Dallas sign a contract extension with T.O. and you are not legally required to intervene. The bank is not required to inform you because lawmakers haven't chosen to impose that sort of duty on them. Is it right? Maybe, maybe not. I am hardly the one to analyze such an issue in depth.

What it all boils down to is this: Bank of America has every right to demand repayment for the checks it cashed for you. It also has no legal responsibility to warn you about the scams going around. Given the prevalence of these scams and the attention they garner, this might change in the future. But for now, there really aren't any grounds on which to found a suit against a bank for this.

I'm really sorry for your loss, and I'm sure the people on the other end of the line are as well. I don't envy the people who have to call to collect on these scam victims- these are often people who were ready to believe more than most because they were already in a tight financial spot. They know they're taking food and even shelter from you, and I don't think the employees are happy about it. They probably detach themselves as much as they can to keep themselves from breaking down and getting fired. I know I wouldn't be able to do that for a living.

What you CAN do, and moreover what you SHOULD do, is ask the lawyers you know if they'd be willing to help draft a bill to be sent to Congress to create a statutory duty for banks to at least prominently post a list of current known scams at all their branches and ATMs. If that can be established, then any bank who does not post such a list will be legally responsible for anyone taken in by a scam. For now, that's the best protection the general public can get.

I hope this helps a little. Cheers.

 Post subject: Re: Bank of America, class action
PostPosted: Thu Jan 15, 2009 8:02 pm 
Site Admin/Co-Founder

Joined: Mon Mar 31, 2003 10:09 pm
Posts: 2921
Thank you for your wonderful post. As you can see from the date on the first post in this thread, the idea of a class action was brought up years ago and while I never really thought it would work out, I looked into it because it was what so many of the scam victims wanted. I think that since that time we have learned a lot . . . and the points that you make are exactly what we have learned . . . the customer is liable for the money lost, the banks have no legal obligation to "do the right thing" . . . I don't like it, but that is how it is.

I also agree with you that what must change is the law and banks should be required to post information about these scams. I would also LOVE it if they would NOT tell people that a cashier's check is good in 24 hours . . . tell them the truth . . . it takes an average of 5-10 business days for the check to go through the system and for the money to be good for a person to use. (If our former bank would have said that, we would not be having this conversation right now because we would have never gotten scammed)

Thank you, and I would love to speak to you more about your thoughts on this topic.

Shawn Mosch
Co-Founder of
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