Couple spends $100,000 after bank error

Miscellaneous and Personal Stuff I Must Share
41

I don’t know much about international banking, but obviously, if you transferred it out from your end, they would have a record. If you arranged a wire transfer where it is pulled from the account, it seems very unlikely that they would not know where it went. And there could be records of you arranging for the transfer – phone calls, emails, a Google search for Swiss banks, etc. unless you were exceedingly careful from the start. And, again, not knowing that much about international banking, I’m not sure that a Swiss bank would have the same view of pulling money from an account as it might if you showed up with cash. Accepting a deposit no questions asked may not be a crime. Agreeing to pull money from a US account in a way that is untraceable might subject the 2nd bank to criminal and civil liability of its own.

So, yes it would be a crime for the account holder, I’m guessing it would be traceable or there would at least be enough of a trail to point to the account holder, the 2nd bank might be committing a crime or a tort, and if you lie and say you don’t know where the money went you might be committing an additional crime. So, all in all probably a very bad idea.

As for what the legal liability is, it’s going to be the crime of theft in most if not all jurisdictions, plus there are civil actions that cover it as well. Think about it this way – if you park your car in your friend’s neighbor’s driveway by mistake when you are visiting your friend, does the car become the neighbor’s? Other than, perhaps, to move it out of their way (let’s say you leave keys in the visor) can they drive it? Could they use it for free to drive for Uber to make money?

The pretty obvious answer to the first 2 questions is no, that would be a crime (and a tort). They can likely have it towed, but can’t treat it like it’s their property. The third scenario would also be a crime, plus you would probably have additional civil claims based on their using your property to make money.

Anything other than reporting it immediately to the bank and not touching it has high legal risks. Exercising any form of control over it, like transferring it to another account can be a crime and a tort. Even if your intention is to return it promptly when asked to, it may still be a crime, or you might have to rely on being able to convince a jury of your intention, which, again, is pretty risky.

42

The bank will never be the loser because they wouldn’t do something as stupid as the couple did. The analogous situation would be: you see that $100,000 has mysteriously disappeared from your account. You go to the bank and they say they made a mistake. You ask them to correct it and they say, “sorry, we spent that money; we don’t have it any more”. In that situation the bank would absolutely be in big trouble.

43

Theft of property lost, mislaid, or delivered by mistake:

“A person who comes into control of property of another that he knows to have been lost, mislaid, or delivered under a mistake as to the nature or amount of the property or the identity of the recipient is guilty of theft if, with intent to deprive the owner thereof, he fails to take reasonable measures to restore the property to a person entitled to have it.”

18 Pa.C.S.A. section 3924

The tort I’m primarily thinking of is conversion. Moving money to an interest bearing account with the intention of using it to generate interest, and the intention of keeping the interest, is likely conversion. There may be other civil claims that also apply.

44

I wonder how much of that $15000 they gave to friends will be paid back to help the couple pay the bank?

45

Actually the bank (its shareholders) is a loser if the stupid couple can’t pay back what they owe or can’t for years, time value of money, which seems likely. Because the bank definitely cannot tell the rightful owner of the money ‘sorry, we can’t give you back your money because in the meantime we gave it to the wrong person and they spent it’. The bank still owes the rightful depositor the money, and that depositor could absolutely take the bank to court in the far fetched scenario where the bank tried to give an excuse like that to not pay. And if paying depositors back money the bank had lost drove the bank to insolvency, the FDIC would make whole any depositors who got shorted, up to the applicable limits.

The law is as it is from POV of knuckleheads employing ‘finders keepers’ as a blanket legal axiom in part as a logical result of the principal that banks aren’t released from their liabilities by mistakenly giving the money to the wrong person. The integrity of the system would be compromised by saying errors by bank employees were strictly the problem of the bank’s owners or particular depositors or (if big enough) all depositors if the people erroneously receiving the money, and who had to know it was an error, were free to squander it.

46

As far as withdrawing the money anonymously (or however the suggestion was worded), folks seem to forget that banks have cameras EVERYWHERE and they are of remarkable resolution. Since damned near everything is done electronically now, the date stamp on the camera video and the transaction from the pertinent teller window are all plenty evidence to indicate “who done what.”

In the past when stupendous errors like this have occurred, smart people have “borrowed” the funds to place in a very short-term interest bearing account. The bank has then successfully sued for the interest, because the mistaken recipient did not have permission to use the money.

No doubt, the bank’s legal team will sue for and receive a money judgment against the stupid people. They will discover that tax refunds and bank account balances will vanish like smoke for a long time to come.
~VOW

47

Not a Woosh at all; I just wouldn’t go around stating that I was suffering from a case of smallcox. The joke works as well changing “I” to “my roommate”, leaving someone else to be pointed to & laughed at.

You do realize how little of a depositors money a bank is using? They can make loans/investments basically ten times total deposits & that, collectively, banks made $60 billion last quarter; the time value of getting repaid over years is a fraction of a drop in the bucket to them.

48

Or their self-proclaimed attorney cited the landmark court case Finder Keeper v Loser Weeper.

49

One time a friend of mine asked me to deposit into an account I had at a US bank what appeared to be a certified check for $8000. He told that he was suspicious of the check (he never explained why). So I mailed it off to the bank along with a letter describing what my friend had said and asked to be informed when and if the check cleared. Of course I didn’t withdraw anything from the account. A month later, the check was returned unpaid and I gave it back to my friend. To my utter astonishment, I got a month’s interest on that $8000, which came to a few dollars in those days. My friend explained that for that month, the bank was richer by that money and was able to base a loan on it so it was entirely reasonable that they paid interest. I did keep that money.

50

That would only work if you disappeared abroad too, and you’d need a lot more than a $100K to pull something like that off.

51

I had the reverse happen to me, although it was a money market account. I had an extra $200,000 or so credited to me. When I notified them, they quickly removed the extra money. Then then took out an extra $15 or so of “unearned interest”. Then they took out the unearned interest a second time, so I was out $15. When I complained about this, they added back $15, but put it in a second account by itself. After another year or so they declared the $15 account dormant and I was out $15 again.

52

When I first read about this story, I thought “What if this happened to me?”… Say I withdrew modest amounts for things like food and other necessities, while the bigger purchases (bills, etc) were withdrawn automatically… I basically imagine, edit, and whatever it takes to at least give me a few moments of imagination.

53

Are you sure? Insurance policies that cover mistakes are extremely common in the professional world- doctors have malpractice insurance, architects and engineers have E&O (errors and omissions ) insurance and construction contractors are certainly insured for incidents resulting from the mistakes of their workers.

I find it hard to believe that insurers wouldn’t write those policies and/or that banks wouldn’t want them.

I do have a good story about a bank making good on a mistake. This was in the old days (late 1970’s early 1980’s), before the days of electronic transmissions, scanners or large scale copiers.

My friend and his friends were in the business of providing design and technical services to the some of the many discos and nightclubs in New York City. They were introduced to some allegedly wealthy foreigners that allegedly wanted to open a nightclub somewhere. My friend and his friends took them on a champagne and cocaine fueled tour of the city’s nightlife, all while discussing what design features of the the various clubs they should emulate or avoid. My friend and his friends pretty much figured that the allegedly wealthy guys were full of it, but they were having a good time playing high powered designers while getting thoroughly blitzed and played along.

And the end of the evening, the allegedly wealthy guys gave my friend and his friends a 10K check apiece as a deposit on …something. My friend was pretty sure the check was bogus but he took it to the bank and deposited it anyway. His friends did the same and their checks bounced. But my friend got a call from the bank telling him that his check had been lost. Physically lost. They had the receipt for the check but no one could find the document. Remember, this was in the pre-electronic days.

My friend told them he had no way to contact the issuer of the check. The bank told him that since it was obviously their mistake, they would credit his account for the 10K. So he got a little windfall.

54

Curious, what constitutes “reasonable meaures?” Is it enough for me to passively leave the errant $100K in my bank account and wait for the bank to notice? Or am I obligated by this law to actively contact the bank and inform them that the deposit may be an error?

55

I could see banks not wanting them. Errors are probably are evenly divided between gains and losses. There is also the bank’s ability to simply correct most errors.

56

How could doing nothing at all be considered “reasonable measures”? ISTM, doing nothing is exactly what it’s a law against.

57

You’re both skipping the “with intent to deprive the owner thereof” part of the law. If you simply leave the money untouched in your account, how can it be proven that you intended to deprive the owner of it? Though I’d say the instant you transferred it out, even into another account in the same bank, you’re probably in violation of that law.

58

For as long as you have it, the other person does not have it. I suppose it would be up to the court to figure how feckless one can be before a reasonable person will conclude you’re deliberately choosing to do nothing.

In a case like this the Reasonable Person test may be the expectation you’ll at least ask “is this right?” upon noticing a $100K mistake.

59

But if I leave the property where the other party inadvertently left it, and they have full access to that location to remove it on their own, I think it would be impossible to prove “intent to deprive the owner thereof”.

Say someone parks their car on my lawn and disappears for a week. I do nothing. How can they prove I intended to deprive them of it? They can walk up and drive it away any time they please, just like the bank could withdraw the money from where they put it any time they please.

60

There is no requirement that you check your account every day or couple of days; the bank only provides statements once a month.
There is no guarantee that you’ll check the statement the day it hits your mailbox. You could be away or just not get the mail for a few days.
There is no requirement that one is observant about checking their balance. I typically have enough to pay my bills; if I sign in on the app to do bill pay I don’t even see balances. if I sign in on the website, balances come up on the homepage but I also know that bill pay is on the top of the page & could click directly on that. I use a small FI; while the app & website are available at anytime, customer service only has daytime hours. If I notice a problem at night, I can’t call anyone then & need to remember to call the next day.