It's sad to see racial prejudice alive and well in business and banking

Miscellaneous and Personal Stuff I Must Share
122

Sufficient proof would be something (anything) to suggest that the outcome would have been different if the incidental element of his race was different, apart from including your conclusion as a premise by saying “Well, he was black, so it seems most probable that he was a victim of racism.”

This is hard to accept because anyone looking at the scenario dispassionately would logically expect (up until the arrest) precisely the same reaction from the bank if the customer were black, asian, white, or an inanimate carbon rod magically imbued with the ability to be responsible for financial transactions.

Mr. Njoku complains “I was embarrassed. She asked me what I did for a living. Asked me where I got the check from, looked me up and down—like ‘you just bought a house in Auburn, really?’ She didn’t believe that." Well, sure - that’s exactly what anyone would experience in that situation, if they had a parallel past history with the bank and cheque which varied in appearance from the teller’s expectation. If your finances have become significantly screwed up, get used to being treated like a bug by anyone who is looking at your records. (At least, this was my experience during the time it took to recover from a financial disaster that suddenly left me with a couple of grand in debt and no income - those bright, helpful, glad-to-see-you faces rearrange themselves into dubious expressions of thinly-veiled contempt when those red flags show up, and you bet your ass that it’s humiliating - but it ain’t racist.)

What sets this incident apart is that the bank proceeded on the belief that the cheque was a forgery. If you’ve ever worked in financial services you aren’t going to lend much credit (heh) to the notion that they invited Mr. Njoku to back into the branch and arranged to have police waiting for him based on the suspicion that the cheque was forged - this is simply not credible; if they took this step it was because they had followed rigidly-prescribed procedures for fraud detection and somehow the policies they had in place returned a false positive. Either they were directed to look for security features which were not appropriate for the instrument in front of them, or there was a transcription or MCR error when they attempted to confirm the validity of the cheque.

To characterize this as a mere “alternate” explanation for what happened, on parity with “they must have assumed it was fraud because he was black” is not a reasonable position. The “non-racist” explanation is consistent with the facts as presented. To argue this way is to put yourself in the same category with people who argue that creationism is just a good a theory as evolution. No, it’s not - if you have an extraordinary position, you’d better have some strong evidence to support it.

This is not nearly the same thing as saying that racism doesn’t persist into present day, and anyone who capable of thinking that clearly spends their days in Cloud-Cuckoo Land. However, this outcome is completely explicable absent racism, as a result of (entirely reasonable and predictable) scrutiny and an honest procedural error. This conclusion is supported by the general outcome in situations like this. If Chase’s policies and culture allowed for the possibility of clients being arrested on mere suspicion of fraud, then we would expect to hear stories like more frequently.

Bank employees are basically automatons, and they are carrying out policies which are designed to be of maximum benefit to the bank. It doesn’t serve the bottom line to alienate 30% of their potential clients, so you can bet your ass that they have fastidiously crafted their policies to be anti-racist. Really, a bank only cares about the colour of your money.

123

I don’t see that alleged anywhere - according to the narrative, from the point of view of the bank, Mr. Njoku and his cheque left in the custody of police, and the next day they passed on the information that a horrible error had occurred.

Now, the bank’s error was compounded by the employee who judged that leaving a voice mail message for the detective that was on the case was duly diligent. But as far as the bank is concerned, once the error was explained, then Mr. Njoku and his cashier’s cheque aren’t really their concern anymore - and they might be forgiven for assuming that he was promptly released from custudy and his property was returned to him immediately. (And why not?)

One might also assume that after this ordeal the last thing that Mr. Njoku would do would be to walk back into Chase and ask to have his cheque cashed, please. Personally, I would assume that his logical course of action would be to take it to another bank, deposit it, and wait for it to clear.

In the lawyer’s letter to Chase, he makes no mention of any demands for a reissue of the cheque, and no allegations of a refusal on Chase’s part to do so. Indeed, under the circumstances there is absolutely no reason that the bank would do anything apart from break their backs bending over to accommodate a request like that with all haste. Since there is no mention of any such demands, I take this is a reliable indication that none were made, because omitting particulars of these demands would require a level of incompetence on the part of the lawyer which seems entirely unlikely.

124

I wonder if we’ll ever hear the final outcome of this.

125

Once the cheque was presented for payment, demand was made. The fact that the cops took the physical cheque with them is immaterial - it was properly presented to the bank in the first place, and left (in the custody of the police) after it was presented, as we now know properly, for payment.

There was really no need for Mr. Njoku do do anything further. Once proper presentment had occurred, the bank owed him the money. In terms of practicality, Mr. Njoku may have pressed the bank to make payment, but there was no legal requirement for him to do so - he’d already made proper demand for the money by presenting the cheque; nothing subsequent to that had cancelled his initial demand. There was no legal need for him to again present the same cheque to the bank, or to anyone else.

126

I don’t know about detailed legal technicalities, but don’t banks in general like to have the check in their hot little hands when they pay you and not floating around somewhere uncanceled out of their control?

127

It was in their hot little hands.

What happened to it subsequently is none of the customer’s concern.

The issue here is who should have the use of the money (and who should have the risk of uncertainty) after a perfectly valid cheque was presented for payment - the bank, or the customer.

I’m not a banking lawyer, and obviously not one in that jurisdiction, but I think the answer is clear - once a valid cheque is presented for payment and cleared, it is the customer’s money - not the bank’s. The bank takes any possible risk of subsequent fraud using its own paperwork.

It hardly lies in the bank’s mouth to say, “oh, but because of a fraud investigation launched by us, which as it turned out is totally without foundation, we get to keep your money for a month because we do not physically have the cheque any more, having ourselves handed it over to someone, and so can’t take the risk that the customer may come back and try to defraud us by cashing it again because we did not stamp it cancelled”.

The answer to that from the customer is - well, tough. The cheque was properly presented. What happened to the physical piece of paper after I gave it to you is at your risk, not mine. Give me my money. Now. Or take the risk I’ll sue, for any damages to me that may result from you illegally holding onto it.

128

I think your really reaching here.

By the time the bank figured it was valid they didnt have it and the guy they owed the cash to wasn’t there to give cash too. Were they to mail him cash somewhere? Where to? His account wasn’t valid. Were they to write him a new check? But why do that, doesnt he have the original?

If the bank reasonably thought the guy was out of jail and he was given his check back (and Larry Mudd makes a good arguement for that), what the heck is bank supposed to do? For that matter they don’t even know there is a problem.

It sounds like he didnt ask for a new check. It sounds like he never went back to the bank.

Sounds to me like after the arrest the guy was mostly a victim of the bank not knowing what was going on and the guy not having enough sense to complain/do something and some police dickery/stupidity thrown in.

Now, if you tell me the bank KNEW the check was good (eventually), knew the guy didnt have it because the police were being twits (or the bank was in cahoots with keeping the check as “evidence”), and refused to cancel that check and give the guy a new one and cash that for him…then hell yeah they were jerks of the first order.

Its not valid when its presented. Its valid when they decide it is. Honestly, it seems to me your using some sort of time travel legal arguement here.

129

By what legal principle are they obliged to go to extraordinary measures to make sure that he has this money? Isn’t this dependent on him presenting himself and saying “Say, about my money..?”

Presumably, he wasn’t someone that Chase was able to reach with any reliability. After all, a year had passed and they had not been able to recover the $600 owing to them from his bad cheques.

130

The check went with the police under the assumption it was fraudulent. When the guy goes back to the bank to get his money the bank needs something to work with.

This is what the teller at the bank heard, “you know, the check I gave you a month ago just before I went to jail for suspected fraud”. “The police kept it but I really need the money”. Enter the slow moving cogs of a large company.

131

Not at all. Legally, the cheque is valid when it is validly presented. What “time travel” is necessary?

A cheque is not valid at the bank’s election. It is to be paid when (a) presentment is properly made and (b) the time described in the user’s agreement or by statute (generally 7 days) for clearing has passed.

His account was overdrawn, a fault which the bank remedied by subtracting money for itself, not non-existent. I can’t buy that the bank could not have found some way to put money in it (probably by clicking on a keyboard).

132

The legal principle that you are not allowed to keep someone elses’ money that you have no right to, when demand has been made for it? There is even a fancy legal name for that - “the tort of conversion”.

He had already presented himself - with a totally valid cheque.

There were no “extraordinary” measures necessary - merely depositing money into the account conveniently at hand.

I think what you are forgetting is the relationship between a bank and someone cashing a cheque on them is that of debtor to creditor.

Think this through as if no bank was involved. I lend a pile of money to someone. They write me an IOU, saying on such and such a day he’ll give me my money back. When I quite properly ask for it back, the person to whom I lent it does not recognize me and has me arrested, and the police seize the IOU after I gave it to him. The next day he calls the cops and say it was all a terrible mistake - but the cops keep the IOU for a month, or a year, or whatever. Does the person I lent money to get to keep it until the physical IOU is returned? Clearly not.

The IOU is just the paperwork detailing the debt, not the debt itself. That came due when I asked for it, IOU in hand. At that point, the guy I lent the money to had no legal right to hold onto it. If he does, he’s liable.

133

Actually, on re-reading the story I’m incorrect in one point - the bank had in fact closed his account.

They still have the obligation of paying him his cash, even if they lack the easy method of simply depositing it in his account.

134

The bank isn’t going to cash a check they don’t have. Your position makes no sense. You’re trying to pound a square peg into a round hole. The bank would have to cancel a legitimate check that still exists. The fact that the recipient no longer has it is a complication. They also can’t deposit it into an account that is closed. The account no longer exists.

You’re confusing a great injustice with the ability to fix it quickly. About the only way the bank could have given him his money would be if the President of the bank just waved his magic wand and donated the money as a gesture of good will. That would have been a good business decision considering the bad publicity and lawsuit they face.

135

And the proof they owed him money is…?

136

The letter from the attorney to the bank says that the bank should have reissued the check or given him cash, and that its failure to do so constitutes conversion.

137

As you are a legal professional, I am confident that you have a clearer grasp of all the relevant law than I might ever hope to have picked up through happenstance - so I wouldn’t presume to argue with you, but only ask for further explanation, as I remain confused.

It seems clear to me that the bank’s obligation was to honour the cheque, as it was clearly a valid instrument. Assuming, however, they did not refuse to honour the cheque on whimsy but had arrived at the erroneous conclusion that it was a forgery honestly (as is the impression I have,) and that Mr. Njoku did not assert to them his claim to his money until he had retrieved the instrument from evidence (as is my further impression) then did the bank have any legal obligation to actively endeavour to seek him out and ensure that he received his money?

If not, I don’t see how they might reasonably be held liable for whatever losses he suffered through not having his money for another month.

Given that his account was closed, and there is no reason to believe that they had his current address, I don’t understand how they would be expected to put the money in his hands without him further asserting his claim to it, and am not at all surprised that no steps were taken in this direction. They had every reason to believe that he was still in possession of instrument that ought to have been as good as cash to him (if not for whatever typo or administrative screw-up misled them.)

No?

138

And from my understanding they did pay him the money. I think the argument of timeliness revolves around the physical evidence of the check. They need it to cancel it or honor it. It’s something of a catch 22. A bank clerk isn’t going to be able to handle this and it should have been bumped up to someone who could give the guy money completely aside from the debt owed as a matter of good publicity until and in addition to straightening out the check.

139

If I were his attorney I’d approach it from the standpoint that they got him thrown in jail unnecessarily. Considering the check came from their own company I don’t see where they can say it wasn’t verifiable. Their only defense is that the guy walked away leading them to believe it was fraudulent which is the behavior of someone who tries to cash a bad check.

140

Okay, I ran this past some people I know who work for banks, including one who works specifically in the fraud department of a bank (and there is lots and lots of fraud and attempted fraud these days) without mentioning that the guy was black. The question to hand was: Would you call the cops.

Yes.

Then I threw in that he was Nigerian–but it didn’t matter because, without even knowing that, one of them said they’d call a manager, and the other one, who IS a manager, said he would HAVE to call the cops. Even if the check was drawn on their bank. Because there are some very good fakes out there and banks have been burned.

So the initial thing wasn’t necessarily racism, but of course, it can’t be ruled out.

However, what would happen next at either of their banks, once the check was vetted and found to be good, diverges quite wildly from what happened at Chase. They would have made sure the guy got out of jail, they would have paid all charges to redeem the car and gotten the car back, and they would have made good on the check, immediately, the next day. (They both agreed though that Chase is a horrible bank, but said that was beyond the pale even for Chase.)

And remember that bank that foreclosed on a house owned by a couple, and said house happened to be PAID FOR? Banks are not the gold standard for customer service.

Bad customer service is apparently just as rampant as check fraud, probably even more so, but my bank experts seemed to think this kind of treatment–after the check was proven to be legit–was much more likely to be doled out to someone who, in their view, wouldn’t make a lot of noise about it. So that’s probably where the racism would come in.

141

Since when are blacks not known for making a lot of noise?

:wink: