Consumer complaint received 2021-05-27
Company: JPMORGAN CHASE & CO.
State: CA
Product: Checking or savings account
Sub-product: Checking account
Issue: Closing an account
Sub-issue: Can't close your account

Complaint:
I am writing in hopes that you can assist me in the mishandling of my deceased mother 's checking account with Chase Bank. My mother died on XX/XX/2021 and was credited her XXXX social security benefits to her Chase Bank checking account on XX/XX/2021. 

On XX/XX/2021, I received an email from Chase Bank advising my mother 's account was overdrawn and the available balance was a negative {>= $1,000,000}. I had to count the decimals as I could not believe the amount was a negative {$99.00} XXXX! That same day ( XX/XX/XXXX ) I went to the Chase Bank branch in XXXX XXXX ( XXXX XXXX XXXX ) with my mother 's death certificate to close her account, as I am the beneficiary of the account ( I am also the executor of her estate ). At which time I was advised by XXXX they could not close her account or let me withdraw any of the funds due to the negative {$99.00} XXXX hold on the account. Two days later XXXX contacted me and advised me that I could withdraw some of the funds from the account, but not the {$1200.00} representing her social security benefits that were electronically deposited to her account after her death on XX/XX/2021. They further advised me that " XXXX '' requires a 120 day hold to allow the government time to reclaim the benefits. However, they are putting a 180 day hold on the {$1200.00}, and I would have to wait 6 months to receive the {$1200.00}. 

Subsequently, I have researched the " XXXX '' they mentioned and determined they are not allowed to keep electronically deposited funds or put a hold on funds for her social security benefits that are deposited to the account prior to receiving notification of her death. I did not notify of my mom 's death until XX/XX/2021. In addition, they did not put a hold on the account until XX/XX/XXXX, which I assume is because that was the date that they too also became aware of my mother 's death. Please note my mother 's death certificate was signed by the coroner on XX/XX/2021. Please see below, from XXXX, XXXX XXXX, pages 4-5 : " Requirement to Return Post-Death Benefit Payments It is important to understand that once a payment has been credited to payees account, it becomes the property of the account holder. In the case of post-death payments, the payments become property of the joint account holder or decedents estate. The government can not legally authorize or direct an RDFI to take funds already credited to an account and send them to the government. This is the reason that RDFIs are directed only to return post-death payments that they receive after they become aware of the payees death, using an R14 or R15 code. Such returns are legally permissible because the payments have not been credited to the recipients account and therefore have not become property of the joint account holder or decedents estate ... RDFIs are cautioned that Fiscal Service does not authorize or direct RDFIs to debit or otherwise affect the account of a recipient, including to return post-death payments already credited to an account. '' The XXXX further states on page 8 of Chapter 5 the following : " No Holding of Payments Under no circumstances should an RDFI hold benefit payments indefinitely in a suspense account, or by any other means, nor should benefit payments otherwise be held if any of the conditions apply on when to return a benefit payment. Holding benefit payments may constitute a breach of the RDFIs warranty for the handling of federal government ACH payments under 31 CFR part 210 and could result in an RDFIs inability to limit its liability. '' According to the XXXX, it appears that Chase bank should allow me to withdraw the {$1200.00} as it was credited to the account on XX/XX/2021, PRIOR to Chase Bank becoming aware of my mother 's death on XX/XX/2021. Chase bank can not put any hold on the account, let alone for 180 days, on my mother 's account! 

Chase Bank has cited the XXXX that they are required to hold the funds for reclamation from the Government. However, that is NOT what the XXXX requires of them. Evidently, according to the XXXX, what Chase bank should have done was flagged my mom 's account once they became aware of her death ( XX/XX/XXXX ) so no further government deposits can be credited to the account, not put a hold on previously credited government deposits to my mom 's account prior to becoming aware of my mother 's death. Then, if they receive government funds after becoming aware of my mother 's death, such funds should be returned to the government by the bank. What they can not do is put a hold on the account, for any time period, let alone for {$99.00} XXXX, and wait for the government to debit the account. 

The 120-day rule in XXXX that Chase Bank cites for justification of putting a hold on the account, is not used for that purpose, but rather the 120 days is how long the government has to initiate a claim against the bank for not returning money the bank received AFTER becoming aware of her death that they should have returned to the government. My mother has not received any social security government benefits AFTER the bank became aware of her death, so no funds should be returned to the government. Regardless of when the electronically funds were received, the 120-day rule does not permit the bank to put a hold on the account. 

Any assistance you can provide would be greatly appreciated.

Company response to consumer: Closed with explanation