Are you asserting that the account holder who deposited the check is not responsible for any amounts of the forged check deposit that they spent/transferred out?This makes the assumption that the issue is checks being deposited that would immediately bounce.Not sure why extending the hold for app-based deposits to 3 days or 7 days or 10 days does not solve the problem. Surely it doesn’t take that long to see if a checking account has the funds to cover the check.
What if the issue is that people are forging checks against valid accounts, and the fraud is only being detected when the account holder at the originating institution discovers and reports that their funds have gone missing? In those scenarios the original account gets the funds back and the institution that accepted the check is on the hook to claw back the funds (if they can) or eat the loss.
I rather believe that if I deposit a check in Fidelity that bounces, that I will not be able to spend any of it and if I have (before it bounced), would have to replace that amount with funds from another source (savings, deposit, sale of assets etc).
It's not like I can deposit a check for $100,000, spend the money after a hold, have the check bounce 30 days later when the account holder discovers the fraud, and not have to repay the $100,000 or have it taken from my account (should it be large enough). Yes, Fidelity would have to get the money from me but that is what is so perplexing ... accounts with more than enough to cover such a situation are getting restrictions. As such, there would seem to be little risk to Fidelity.
In any case, many here are accusing Fidelity customers of running this fraud campaign, but I don't see how knowingly depositing a bad check into your own account will yield you any cash. I do suspect rather it's either some kind of overpayment scam where the Fidelity investor is returning some extra payment only to find the check bounced, or Fidelity customers are unknowingly receiving forged checks.
Why a check for a company match on a solo 401(k) plan written on the company checkbook would cause an account to get locked is pretty perplexing. You would think there was money in the 401(k) to cover any potential clawback on the check and that a company match for a 401(k) wouldn't be very suspicious.
People don't like this suggestion but google "AI in fraud detection" or "AI in fraud detection finance" or similar and see how many companies are offering products. I wouldn't be surprised at all if Fidelity were teething a new fraud system. OK, call it a new algorithm because saying AI triggers people it seems.
Statistics: Posted by typical.investor — Sat Oct 05, 2024 10:24 pm — Replies 601 — Views 32456