I’m an American freelance illustrator and occasionally I’ve had requests for image usage rights come in from overseas…usually it’s not a big deal, and I send or fax or email an invoice and they send me some kind of check or cheque or whatever the hell they decide to send. This time, however, I was contacted by someone in New York on behalf of a Danish Science Illustrated magazine about purchasing usage rights for one of my images, and this was in the email:
The email lists the New York contact’s name and company and phone number and address, as well as the Danish company’s info and website, and the website seems legit, the rest of the info seems legit. Of course, the big red flag for me is sending my banking information to anyone, much less to someone on an entirely different continent. Does anyone know if there is any truth to the claim that EU regulations require that a company have the banking information of someone in order to send them payment? It just sounds fishy to me; it would seem like I should tell the New York rep to send me a check as per the usual arrangment and for them to bill the Danish company for compensation. Any other ideas?
This has been discussed on my freelance list, and IIRC, if they are doing a direct bank transfer they will need your account number, and with just your account number they cannot do any shenanigans with your funds. But I can’t imagine that they would need it to cut a check.
This question seems to come up every once in a while. The basic issue here is that some countries use a “push” banking system, while the US generally uses a “pull” system.
In the US, if you want to give money to me, then you give me a little piece of paper (a check) saying that I am authorized to pull money out of your account. In some countries, if you want to give money to me, then I give you my banking information and you push money into my account.
Now, I don’t know what EU regulations have to do with this. I can definitely imagine them wanting to know at least your identity for withholdig purposes (say, if you were selling land in the EU and they wanted to withhold some of the amount you receive for taxes since you probably wouldn’t pay if they didn’t withhold because the EU can’t come and get you here in the US). And I’m also not sure how the New York agent fits into the picture.
One thing, though, is that just because someone has your bank account info doesn’t mean they can steal all your money and you can’t get it back. The “properly payable rule” states that a bank can only pay checks out of your account that are properly payable, and if you didn’t authorize the payment, then its not properly payable. The bank must immediately and fully recredit your account for any amounts the bank paid out on a check that was not properly payble (absent a couple of rare exceptions, like you being negligent, etc.).
Were I you, I’d contact the New York agent and try to take care of it through him. If that didn’t work, then I wouldn’t feel uncomfortable giving the guy my banking information. Hell, I’d post my information right here if I didn’t think a mod would delete it.
Very common in the UK to make direct payments to people’s bank accounts (either by BACS or CHAPS transfers).
The information that they ask for is mainly readily available (banks details) and your bank account number is not exactly top secret (it is printed on every cheque you write!).
These details can only be used to pay money into an account. To withdraw you need either a signature (on a cheque or a Direct Debit form) or a card and PIN code if using a cash card.
If you are worried about it ask your bank if this is normal practice, and if there is any reason why you should not give out that ingormation.
JerzyBulowski, are you referring to the OP or another poster’s comments. Either way if something is incorrect, it is useful to offer an alternative and, preferably, a cite.
This sound like bullshit. I’ve never heard of such an EU regulation. Furthermore I’ve never had to provide such information, except by my Nigerian busines partners.
I strongly/ advise you not to provide this information. They might use it to convince the bank that they are you and that they should use a different address and telephone number for notification. In that way they can empty your bank account, without you being notified in the short term.
Even though Taxguy is right in principle that the bank is obliged to check that you gave the order, the conditions of the account may oblige you to complain within a short period of time. If they reroute the bank receipts, you may be too late.
If you really want to test them, ask them for details on the specific EU regulation. If they can actually provide a reference, you could look it up at http://europa.eu.int/eur-lex/en/index.html to see whether it really says that.
Thanks everyone for your responses. After checking into things further with the guy in NY and also with my own bank, it appears that fezpp is exactly right; the Danish publisher wants to pay me by direct transfer of funds and my own bank was not at all suspicious of the practice; it must be a pretty regular way of doing business for some companies across the pond.
I’m usually in complete agreement with Taxguy’s posts, but this is at best misleading. UCC 4-401 does establish the “properly payable” concept, but the exceptions that can be raised by the bank in refusing to recredit the account are anything but rare. I’ve personally seen such refusals to recredit dozens of times, often on my advice. I can’t address all of the issues here, but will hit a few highlights. There are time limits on reporting the bogus check. See UCC 4-406. This time period is an unspecified “reasonable period” not to exceed 30 days. I’ve seen (and drafted) customer agreements which limit this to 14 days.
Next, if you are a business of any size, your checks will be issued with a machine or facsimile signature. If your bank has a decent lawyer, they’ll be a clause in your account agreement that allows the bank to accept any facsimile signature, even if it actually was not authorized by you. Account agreements can have other provisions adverse to the customer on this issue. Courts have upheld some kinds of these limitations. See
for a somewhat more complete discussion of one kind of check fraud.
Finally, there are the negligence defenses which Taxguy mentioned.
The important thing to realize here is that there can be a whole lot of grey areas on some of these issues. Banks can and will raise these defenses and refuse to recredit the account. If you’re the customer, what are you going to do, sue? Maybe so, if the amount at issue is large enough and you hire a lawyer who knows something about these issues. But even if you win, you’ve wasted a lot of time and money. It’s much smarter to take steps to reduce the risk of this happening in the first place, and the first such step to take is to keep your bank information secret to the maximum extent possible. Sending it to random people in Europe that you don’t know is stupid.
I’ll admit that banks will frequently recredit accounts of good customers, even if the bank thinks one of these defenses apply, in order to keep the customer happy. But it probably won’t if the loss is big enough or happens more than once.
Usual disclaimer. This is general information, not legal advice. I’m not your lawyer. If you face this issue in real life, see a lawyer licensed in your state.
Note to several of you above (you know who you are): I’m not a mod, and I don’t wanna be a mod, but I just want you to know that GQ is the forum where people ask factual questions and expect factual answers. They are not asking whether or not you think something is “bullshit.” So shut your pie-hole if you don’t have a factual answer.
Random, thanks for the add’l info, and I definitely bow to your superior knowledge on the matter (I’m not UCCA4guy after all). I just brought up the properly payable rule to rebut the assumption some people make that others can just come and take money out of their account with them having no recourse whatsoever. Some people are too quick to smell a “scam” when nothing of the sort is going on.
Actually, with check writing software that you can buy at any computer store, you can, with a reasonable probability of (initial) success. I’m not going to write a how-to manual, but it’s done every day.
Have you people not heard of telephone or online banking?
You need to have the bank account details and name and address of the person/company you are wanting to pay.
I think you left out some words here, so I’m not sure what you’re trying to say. Best I can tell, you’re saying that online or telephone bill payment systems require you to disclose account information. You’re correct. For that matter, sending someone one of your checks does the same thing. (That’s the argument I was expecting someone to raise.)
That doesn’t negate my point. There’s a difference between giving your information to the local electric company or mortgage lender and giving it to someone you don’t know. (in a different country, yet.) I’d be reasonably confident that an established business (or people in its payables department) are not going to use my information to commit bank fraud. If they do, there’s a paper trail that police and prosecutors can use to track them down and convict them. If necessary, I’m available as a witness.
But that’s not the situation faced by the OP. He’s been contacted out of the blue by someone unknown to him in a different country. The risk is much higher. Even if the forger is caught, how are the Danish police and courts going to prosecute him without a local witness? Odds are, there’ll be little or no interest in using Danish resources to pursue a small-scale bank fraud affecting people in another country. (Nothing against Denmark. It’d be the same in reverse.)
How do you think people who pull the Nigerian scam loot your account? Why do they choose to target people in a different country?
It’s all about limiting risk. Giving info to a local utility = very low risk. Giving info to an apparently established business in another country = slightly higher risk. Giving it to someone you don’t know well, but who is local, or at least in the same country is higher risk. Indiscriminately sending it overseas to someone you’ve never heard of before is nuts.
I’ve reread the OP, and I may have overstated the situation above. If the Danish magazine is established, and the person who contacted you can prove that he’s associated with it, there’s less of a problem. On the other hand, that might take some doing, given that the obvious first steps (online search, contacting the government agency responsible for corporate/business licensing) are more difficult given the distance and language involved.
Just having someone’s account number allows bad people to do all sorts of shenanigans with their accounts. It’s one very important piece of info they need. Yes, the info is on your checks, etc., and guess what? People take account #s off checks and do bad things. It’s not as trivial as doing bad things with a credit card number, but it is really, really easy.
Allowing someone to direct deposit into your account also allows them to drain your account. Clark Howard has callers on his radio show all the time who have had this happen to them. Oftentimes it’s a utility “accidently aking back” a $20k deposit they in fact never made. But sometimes it’s just outright fraud. The banks just don’t care.
There is a BIG difference between simple online bill pay and direct deposit/withdrawal. Clark Howard says do the former. With the latter, the other people can drain your account. If you don’t understand there is a difference, get educated about it now.
I would suggest the OP setup a deposit account for only this purpose, and transfer the money out the second it comes in. Login and watch it carefully, don’t wait for a monthly statement.
One variation on the Nigerian scam used to be run through corrupt Nigerian banks and I don’t see why it wouldn’t work in other corrupt foreign banks, such as in Russia, or foreign banks with a well-placed corrupt employee. Your bank gets all the right paperwork from a foreign bank that has all the right information about you and your account, indicating that you have authorized that foreign bank to transfer your funds to your account there. Depending on the country it’s run from, you’re going to be a loong time waiting for that bank “error” to be corrected across international borders. True, your bank account information is not exactly top secret but there are people in this great big world who are in a position to try some kind of scam with it, I wouldn’t post mine here.
Lots of interesting information here…thanks for continuing the replies.
To clarify things a bit about my situation:
My freelance illustration is specialized; I depict dinosaurs and other extinct animals, and I generally don’t delve into editorial or general illustration. Recently one of my current and long-term clients (a museum) was involved in the discovery, preparation, and display of a fossil which indicated that a specimen of a dinosaur known as Gorgosaurus suffered from a brain tumor; the story was pretty big news, as far as dino discoveries go that don’t involve feathers. U.S. News and World report did a short article about it a few weeks ago and contacted me to purchase usage rights for one of my Gorgosaurus images. Since then, two other companies contacted me about using the very same image to accompany stories about the very same fossil discovery. One of these companies is the Danish science illustrated magazine that contacted me. I talked to the New York guy on the phone (he’s a science writer who was contributing the story to the magazine) and every part of his story checked out; the magazine’s legit, his email address is provided by an association of science writers, and the stated purpose for requesting the artwork is legit. I know there’s always a chance that for some reason someone would go through this much trouble to scam someone, but I am thinking that the liklihood is small that someone would try a one-time scam of a dinosaur artist which would depend on having all of those pieces in place.
In addition to that, I do remember getting paid for another job a few years ago via bank transfer; it was a South American apparel company. The transfer went through fine, and there was no scam involved there.
Again, there’s always a chance that it is a very elaborate scheme to con me, but if so then the con artists have gone to absolutely ridiculous lengths to make everything seem upfront and legitimate.
