Identity theft: When does a bank's negligence make them responsible for fraud?

A few weeks ago, I found out that a fraudulent check was passed against a bank account that I hold, even though no checks were ever issued for this account. I notified the bank immediately, filled out their forms, and also sent them (certified, return receipt) a letter asking that they close this account, and under no circumstances accept further checks on it. Since receiving this notice, they have accepted two more checks against this account.

My time is valuable, and certified mail is not free. Even if they refund all overdraft fees and cancel all checks, I will be out money over this issue. The vast majority of the fraud took place after the bank had been notified in writing that fraud was taking place. To date, they have received 4 written requests to close the account and stop accepting checks but nothing has been done.

Can I sue the bank for negligence, billing them for my expenses (faxes, certified mail) and my time? CN47? What are the logistical issues with suing an out-of-state bank in small claims court? Should I reasonably expect to win?

I'm not sure you'd have enough real damages to make it worthwhile to pursue them in small claims court, but if it was me, I'd already have submitted a complaint to their local BBB and anywhere else that might prove embarrassing to them. Are you planning to continue doing business with this incompetent bank?

Commercial law 101: the bank always wins.

That said, accepting the facts above at face value, sounds like you have as strong a case as any.

Why are you still leaving any money in the account for scammers to get at? Have you ever spoken to someone there, rather than just writing letters? You should call them immediately and see what they have to say. A CSR should be able to close the account immediately.

As others have mentioned, a lawsuit is probably a losing proposition. You're correct that the BBB can be toothless, but the bank's regulator probably isn't. If talking to them doesn't work, contact the regulator and start filing complaints.

couponhed said: A few weeks ago, I found out that a fraudulent check was passed against a bank account that I hold, even though no checks were ever issued for this account. I notified the bank immediately, filled out their forms, and also sent them (certified, return receipt) a letter asking that they close this account, and under no circumstances accept further checks on it. Since receiving this notice, they have accepted two more checks against this account.

you need to close the account and set up a new one.

at my bank, i was told that if there were pre-authorizations, i couldn't just tell the bank i didn't authorize those charges and that would be the end of it -- the bank rep told me i had to contact whoever was sending the checks, first, to stop sending the checks. barring that, I needed to close the account.

did you find out who was passing the fraudulant checks? did anyone advise you to contact them, for your records, that you never authorized those checks? or were you advised not to have anything to do with them and no contact with them?

have you filed a police report against those who passed the fraudulant checks?

have you taken steps necessary to inform others you are the victim of identity theft (beyond the cmrrr to the bank)?

good luck in getting this straightened out.

Have you written a letter to the CEO? I did that with BofA over a $125 account opening bonus they refused to pay me and I had a cashier's check in the mail within 2 weeks.

Contact the bank's regulator (post their name here too). My guess is that they
have failed to comply with the law. There are time limits for certain actions
regarding fraudulent activity. If you have sent four separate letters, chances
are they are in non-compliance.

Do you really want your money with a bank that doesn't take even the simplest of
steps to address fraud?

couponhed said:
It turns out that PNC's regulator is (appears to be; they dont have National in the name as far as I know):

Pennsylvania Department of Banking
Mr. Steven Kaplan
Secretary

17 N. Second Street
Suite 1300
Harrisburg, PA 17101-2290
Phone: (717) 787-2665
Fax: (717) 787-8773

If the supervisor whom I talked to today doesn't solve the problem before the close of business today, I'll file a complaint with them as well. PNC's full name is "PNC Bank, National Association." Therefore, their primary regulator is the Office of the Comptroller of the Currency. You can find information about contacting the OCChere.

Have you actually walked in to the bank to close the account? Or have you only sent letters? I've closed a couple of accounts in the past and it didn't take very long once I walked in the door...

An ex employer (F 500 Co.) cashed out my used to be pension and sent it to a former address with my social security number on the check. Of course it was cashed then people tried applying for AMEX cards under my name. I got my money after months of waiting but I'd like to sue my ex employer for negligence, not to mention idiocy. Frankly, between credit cards, bank statements, and insurance claims it seems like all of my off time is devoted to other peoples' negligence.

So...you want to sue for your time and the cost of certified mail and faxes, even though going to court is going to take even more of your time and court costs. Now that's a waste of time and money.

Unless they go after you for the checks written after you notified them, don't expect to win in court.

Once I read it was PNC bank, that explained the problem.

Xnarg said: couponhed said: ..Thanks for the idea on the BBB complaint, I just submitted one. I don't expect much from the BBB as they can be rather toothless.I'm am always amazed when people propose filing a complaint with the BBB as a magic bullet to resolve problems with vendors. I agree that they are toothless. Too, they are often little more than an local extortion group that forces vendors to join them (and pay their membership fee) otherwise they'll hound them with false consumer complaints.

Basically if a company joins the BBB, complaints against them will be dismissed, and if they don't join, complaints will be reported forever, even if they've been proven to be wrong.

Of course, this varies by BBB chapter. Some are more honest than others. Once in a while you find a good one that does its job.

There are far too many BBB chapters that are crooked, unfortunately.

Too, large organizations are somewhat immune to BBB complaints. They know that no matter what they do, they'll get some complaints that won't be resolved, so they can just ignore them.

I thought I was never going to agree with Xnarg again... but he is right on here.

Having dealt with BBB from both sides it is a waste of time. If you file a complaint with someone who is not a member they just use it as an opportunity to sign them up as a member to get favorable treatment. It is all an extortion racket.

Beyond that if you don't actually check a company on BBB before you used it, why do you think anyone else will. That is their only real power, if people look up companies BEFORE going into business with them, not after the fact.

As for this, OP I assume this is not a bank local to you? Or else the obvious play would have been to go down there right away and handled everything in person in 15-20 minutes.

Why are you having trouble closing the account? Are they saying they have pending checks against them? There is paperwork and affidavits needed for this kind of stuff. If you can going to see them in person is best, talking to them on phone is second best. Just writing them letters, not best by good margin.

aeiouy said: johnnybs said: artemis028 said: So...you want to sue for your time and the cost of certified mail and faxes, even though going to court is going to take even more of your time and court costs. Now that's a waste of time and money.

Unless they go after you for the checks written after you notified them, don't expect to win in court.

OP can sue for cost of certified mail and faxes, in addition to court costs. However, best to wait until a negative action occurs, such as the things mentioned by CN47.

BTW, I dislike PNC bank- totally screwed with me multiple times when trying to open an account not too long ago.

I wonder what will happen when the judge asks him why he didn't just call them on their toll free number?

What prevents him from saying that he did? He wouldn't be expected to have a record of that. Also, why is he required to contact them by that method? Physical letter is more formal and leaves a trail; why knock it?

File complaint with regulators. It worked wonders for me. Complaints are filed online & bank higher ups should be resolving everything in a couple weeks.

bustgum said: couponhed said:
It turns out that PNC's regulator is (appears to be; they dont have National in the name as far as I know):

Pennsylvania Department of Banking
Mr. Steven Kaplan
Secretary

17 N. Second Street
Suite 1300
Harrisburg, PA 17101-2290
Phone: (717) 787-2665
Fax: (717) 787-8773

If the supervisor whom I talked to today doesn't solve the problem before the close of business today, I'll file a complaint with them as well. PNC's full name is "PNC Bank, National Association." Therefore, their primary regulator is the Office of the Comptroller of the Currency. You can find information about contacting the OCChere.


Ah, thank you.

MrKlick said:
Kinda odd that the bank is "refusing" to close the account. Take out all the money and send a letter confirming it is closed.

This doesn't happen to be a divorce situation where one partner is writing checks on the joint account the other doesn't want honored?


No, there are no other names on the account. Frankly, this is a case of flaming institutional incompetence. These sorts of things never make sense.

Good news though, after talking to a stupervisor who said that they could not both close the account and challenge/refund the checks, I was able to use the words "gross incompetence" in just the right way to be transferred to someone intelligent. They've finally frozen the account and are sending me what should be the final set of fraud report forms to sign, after which they will close the account.

MsJAP said: Have you actually walked in to the bank to close the account? Or have you only sent letters? I've closed a couple of accounts in the past and it didn't take very long once I walked in the door...

I'm not local.

codename47 said:
I don't think you can bill them for your time, certainly for your expenses.

If they report it to chexsystems, sue. If they report it to any other CRA, sue. If they hire a 3rd party collector, sue. You'll be well compensated for your time that way.

Ah, now thats the question. If the latest person I've talked to is even mildly competent, I'll get back all except for the ~$30 spent on faxes, certified mail, photocopies and a notary. If I cannot bill for my time, this is not enough to justify small claims. On the other hand, if they report to chexsystems or another CRA, I'll have to go after them for the relevant statutory damages.

ALMOST NO ONE POSTING RESPONSES HAS A CLUE TO WHAT THEY ARE SAYING. Your local Small Claims Court will NOT work, because you have to serve the bank, you cant serve someone out of state in Small Claims Court.

It's a bank. Who responds if a bank gets robbed? Get the Feds involved, forget the local stuff.