Consumer complaint received 2020-07-21
Company: JPMORGAN CHASE & CO.
State: CT
Product: Checking or savings account
Sub-product: Checking account
Issue: Managing an account
Sub-issue: Deposits and withdrawals

Complaint:
Last month, I became the victim of a very nasty and expensive loan-offer scam ; and Chase bank which should have born at least some responsibility for at least alerting me of highly unusual activity in my checking account, if not doing a few things, as a matter of course in such a situation, to interrupt the scammers in motion, but Chase did nothing ; I never heard a peep from them. 

The nature of this scam was that I had applied for a {$6000.00} consolidation loan, to pay off and close five credit cards, in which I was having difficulty not charging more than I could pay each month ; I needed to close these accounts, and not have all these credit cards in my pocket all the time. 

But the lender who offered the best deal, a 10 % loan due to Covid 19 relief, they claimed. However, they required me to give them access to my online banking username and password for 24 hours ; they would be placing money in my account, and I had to draw it out and send it back to them, as part of their validation process, they said. I only had {$62.00} in my checking account ; how much " at risk '' could I be, if I granted this, and then changed my password the next day, right? 

Well, it turns out that any customer can dispute any payment made, or even any withdrawal made, from their checking account, even by the droves, and even 15 transactions all at once over a couple of days, regardless of how negative that takes the account balance to, assuming all of the disputed transactions were found to have instead have been legitimate ; which was the case here. 

Now, I realize that a bank 's requirements for proof of identity can be phonied up ; all a scammer would need is access to your various components of identification ; which this scam company required as well ; a copy of my debit card, my Driver 's license, my Social Security number. I have historically given this kind of information out many times during the last 50 years of my adult lifetime, when applying for loans ; so in effect, it is not the bank 's fault, if I was stupid enough to give out these tenets of my identity along with my username and password, even temporarily. However, especially because of this, in this day and age, with all of the identity theft and scams going on, a large bank such as Chase, should have consumer protections in place that automatically trigger personal contact with the account holder, whenever there is any unusual or suspect transactions taking place of any magnitude ; certainly when multiple disputes are lodged basically all at once, from the supposed customer ; they should reach out, to make sure it is the actual customer making these disputes, as opposed to some imposter. 

Chase could have emailed me to verify whether it was me disputing these payments that had been called back into my account pending an investigation. They could have had a limit of 1 disputed  transaction per week, perhaps ; unless the customer otherwise met personally with a bank officer that knows the customer ; they could have listed in the memo next to the amount in my transactions list, " Customer payment taken back, '' or forfeited or rescinded ; ( " Adjustment reversal '' is just too vague of a term ) -They also could have called me on the phone to ask me if I really think that multiple payments, like I had been making every month to these credit card companies all year, were suddenly to be disputed? ; the fact is, they did nothing to interrupt, or even question this scam payment-reversal process, or do anything that might raise any suspicion on my part. 

The upshot is that the aggregate of these payments reversed from my credit card companies raised my credit card balances by {$4100.00} ; and then the scammers even disputed that it was me taking this money out at the ATM to send to them ; that added another {$800.00} of temporary increase in my checking account balance ; which I unknowingly assumed was the lender 's money being put into my account, that I needed to send back to them, as part of their loan validation process. By the way, Chase took that {$800.00} out of my {$1300.00} Social Security deposit last month, the day it hit ( XX/XX/XXXX ). 

I just can't understand how, when I can't spend even one more dollar than my credit limit on these credit cards, and I can not withdraw one penny more than what is in my checking account ; yet with these reversals, the credit card companies allowed money to flow out from them which took my balance owed, way over the credit limits on these cards ( Don't you think the credit card companies should not be allowed to reverse any part of the customer 's payments they had received, that would make this credit card holder 's balance to go beyond the credit limit in their account?! I certainly do! ) -But not being contacted in any way by either Chase Bank or the credit card companies, to check on these numerous disputes suddenly being made all at once ; and yet for multiple payments I had made even 3 months earlier ; and I also think the only part of the full memo I saw next to these drawbacks of my payments, was the word Adjustment, or maybe Adjustment Rev ; but even Adjustment Reversal doesn't unquestionably send the message, like for example : Cust Paymnt Returned, or Cust Credit Card Bal . Raised, or CC Payment Refunded might even be better. 
-But when you add all of these factors up, boy, is this the opposite of consumer protection! 

At this point, I am most interested in seeing that this can not happen to anyone else. It seems absolutely imperative that this standard operational procedure, regarding disputed transactions, must change violently and immediately! If I had the money, I would sue the pants off of Chase, and I think I have a damned good case, at that. -So please, as the state regulator, help banks and their customers to be both become less vulnerable, by putting a mechanism in place that stipulates that no more can be withdrawn from a checking account than its current balance ; and that payment reversals may not be withdrawn from a checking account until after the investigation is complete ; and also require banks to notify the customer personally, or by email any time multiple unusual transactions have taken place ; or else be liable to eat the losses that have accrued since this notification unquestionably should have gone out to the customer. 

In addition, when I looked at my transaction history just prior to my account being placed on restriction, I noticed that whereas, my computer runs on XXXX XXXX, and is the only device I use for online banking, a computer running on XXXX XXXX had carried out 13 transactions between XX/XX/XXXX and XXXX. This is yet another way the bank could have flagged unusual activity and alerted me to it. 

I hope this story might lead to some tightening-up type of changes in Chase Bank 's " transaction memo '' wording, and a few other new safeguards that might be developed in order to intervene more effectively, in such scam activity which customers such as myself are subjected to unwittingly, all too often these days, I'm sure. 

I would appreciate it if you would let me know what is being done in this regard. 

Thank you for your attention to this matter.

Company response to consumer: Closed with explanation