Greg's Corner

Bank tells scam victims they gave ‘consent’ to scammers

By Greg Collier

Bank customers are being scammed on an almost daily basis. At least the ones who report the scam anyway, It’s more likely that the majority of recent bank scams aren’t reported to the police or media out of embarrassment. It seems that reports of banks not helping their customers who have been scammed has emboldened the bank scammers to fins more victims since they know the bank won’t do anything about it.

For example, CBS 2 out of Chicago has done a follow-up story on five local bank customers who lost a total of $100,000 to bank impersonation scams.

Scammers often follow a typical approach where they contact their targets through calls or messages, asking about their recent transactions. They then use coercive tactics to convince victims that transferring their funds to a different account is the only way to protect their bank accounts. Unfortunately, the account to which the money is transferred is usually controlled by the scammer. These accounts are usually regular checking accounts available through major banks and not offshore accounts.

Out of the five Chicago victims who CBS 2 spoke with, all five were customers of Chase Bank, and only one of them has been reimbursed. The rest of the victims were told by the bank that since they gave personal information to the scammers, the bank considers that the consent of the customer.

It also doesn’t help that the legislation designed to protect bank customers doesn’t protect victims from wire fraud. If someone uses the victim’s credit or debit card to commit fraud, customers can be reimbursed for that, but victims of wire fraud are out of luck due to a gap in the regulations. We might also add that these regulations were written in the 1970s. Electronic banking has changed a lot in the past 50 years, but the regulators haven’t kept up with the times. We knew that lawmakers are slow when it comes to updating the law to reflect current technology, but we didn’t realizer they were this slow.

Some consumer advocates recommend that the banks should require some kind of digital ID before a wire transfer could be made. Others suggest the banks should institute a 24-48 hour delay for wire transfers. While these may sound like good ideas, practical application of them could be a headache for customers.

What these banks really need to do is to prevent scammers from opening the accounts where the victims’ funds are being wired to. They could even institute a delay when an account tries to close out suddenly.

At least for now, it’s up to the consumer to protect themselves from these scams.

In case you receive a text message that appears to be from your bank inquiring about fraudulent activity, avoid using the callback feature provided in the message. Similarly, if someone calls you claiming to be from your bank and asks about fraudulent transactions, it’s best to end the call and directly contact your bank through the phone number provided on the back of your debit card.

If you’ve been the victim of this scam, don’t hesitate to file a police report. While it’s not a guarantee of getting your money back, it does go a long way in helping.