ALBAWABA - JPMorgan Chase, the biggest bank in the United States in terms of assets, has launched various lawsuits against clients who are suspected of taking advantage of a technical flaw that enabled them to take money from automated teller machines before their deposited checks were processed, Reuters reports.
Dubbed the “infinite money glitch” on social media, this loophole became popularized in late August when videos circulated showing individuals celebrating cash withdrawals following deposits of fraudulent checks.
Customers were able to access practically the whole sum of a check deposit instantly because of the error, which allowed them to avoid the typical verification procedure that takes several days.
JPMorgan has begun legal actions in at least three federal courts with the intention of recovering funds and sending an assertive signal of deterrence, according to CNBC.
A complaint has been filed against a man in Houston who is accused of withdrawing approximately $291,000 after an accomplice placed a fraudulent check for $335,000 in his account. In other instances that have been brought in Miami and California, consumers are accused of collecting between $80,000 and $141,000 from similar transactions.
Check fraud continues to be a substantial peril, despite the fact that digital transactions are becoming more prevalent. According to the Global Financial Crime Report published by Nasdaq, check fraud was responsible for nearly $26.6 billion in losses throughout the world last year.
The court documents submitted by JPMorgan claim that the defendants violated their deposit agreements. The bank is requesting the return of the funds that were withdrawn, in addition to the overdraft fees and interest.
In the meanwhile, JPMorgan has now fixed the technical fault, implemented more stringent controls, and conducted an investigation into thousands of occurrences that were comparable to the one that occurred as part of a comprehensive internal assessment.
