Consumer complaint received 2026-05-22 00:00:00
Product: Checking or savings account — Checking account
Issue: Managing an account — Cashing a check
Company: JPMORGAN CHASE & CO.
State: CA

Complaint narrative:
Background of the Complaint : On XX/XX/XXXX, I listed my XXXX XXXX XXXX for Sale for {$15000.00} on XXXX. On the next day, a couple of out-of-state buyers, who identified themselves ( together ) by the names of XXXX and XXXX with the emails XXXX and XXXX ( herein referred to as The Buyers ), replied on XX/XX/XXXX, stating they were interested in buying the car. They sent a check by XXXX overnight on XX/XX/XXXX, for {$19000.00}, which was unexpectedly far more than I had asked for in the ad for {$15000.00}. They said the extra amount of {$3800.00} was there for me to pay to arrange to ship the car to them from California, but I refused this rather suspicious and complicated arrangement, so I told them that I would have to wait for my bank, Chase Bank ( located at XXXXXXXX XXXX XXXX XXXX XXXX XXXX XXXXXXXX, XXXX XXXXXXXX, herein referred to as The Bank ), to verify that the check was legitimate and would clear with the banks due diligence before going ahead with the deal. I also told the Buyers that, if the check cleared, they would have to arrange for the pick-up of the car on their own as I wanted nothing to do with the liabilities of shipping off a car to an unknown buyer. The Buyers acknowledged that they understood my hesitance and accepted the terms of the original contract, so they were willing to wait until the check cleared ( after my bank did its obligatory due diligence ) to verify the out-of-state check ( which is a standard and obligatory due diligence procedure for any bank to do for such as large amount ) ; receive payment ; and then the Buyers would have to arrange, themselves, for the car to be picked up or transported at their own expense. All I would have to do, at that point after getting the OK from the Bank, would be to wire back the excess amount to finalize the deal. The Complaint It should be noted that once I deposited the check with Chase Bank, the Bank knew about the situation with the check ( because I specifically asked them about it with their representative XXXX XXXX on how to proceed ), and the Bank agreed to do their routine fiduciary duty, which involves their expertise in verifying payments made by checks, to do the necessary due diligence on determining whether the check in question was legitimate or not. Thus, the bank at that point had sole discretion as my financial fiduciary agent in securing the funds and advising me on whether to go ahead with this deal. In other words, only the Bank had the expertise as my fiduciary agent to determine if the Buyers were legitimate or not, and I was relying on their expertise to tell me what was going on with these Buyers out-of-state check for {$19000.00}. That is what a bank acting as the fiduciary agent is supposed to do with any out-of-state check written out for such a large amount, as that is a part of their routine and obligatory fiduciary duty to verify routine banking transaction. It turns out, Chase did nothing in terms of due diligence which I will go over below. On their own website, Chase states their policies on verifying out-of-state checks as : There may be times when clearing a check takes longer than usual. This normally happens when the bank needs to take extra steps verifying the transaction. Common causes of delay include : Depositing a large amount of more than {$5500.00} ( which will change to {$6700.00} in XXXX of XXXX ) in a single day. Suspecting that the check wont be paid. To my surprise, Chase cleared the out-of-state check in just one day on XX/XX/XXXX, and received the full payment for {$19000.00} from a XXXX bank that the check was drawn from. On that same day, since this came as shock to me how quickly the check cleared, I specifically asked Chase Bank Representative, XXXX XXXX, if the check was legitimate, if it could be recalled for any reason, and if I should go ahead with the deal which required me to wire the excess amount back to the buyers in question. XXXX XXXX assured me that, since the check cleared and the payment was fully transferred and received, the check was legitimate, and there was no possibility that the check could be recalled after the Bank received the money for any reason whatsoever. So, then XXXX XXXX urged me to go ahead with the deal stating, The payment was legitimate. It looks legitimate to me. And after receiving the funds, it cant be recalled. So, go ahead with the deal. I see nothing wrong with it. Based on my banks expertise as my fiduciary agent, which I had to rely upon to evaluate this deal ( i.e., I would not have otherwise gone ahead with the deal without the banks fiduciary advice and approval ), I went ahead with the deal and wired the excess amount, {$3700.00} ( plus {$100.00} for wire transfer fee ), through Chase Bank to a bank account from XXXX XXXX XXXX that the Buyers instructed me to wire the excess amount to. Please note : this was all done with the Banks knowledge and approval, guiding me step-by-step through the entire process and transaction as my fiduciary institution and advisor. In essence, the Bank facilitated the entire transaction with the Buyers from cradle to grave from the time the check was deposited to the point where the fraud was finally detected, and the Bank was no wiser to detecting the fraud in all that timedespite being the only ones with the expertise and technology capable of detecting the fraud had they done their routine check verifying procedures which they had negligently had foregone. Their grossly negligent conduct as my fiduciary agent enabled the fraud to happen. Needless to say, we later learned the buyers for the car were fraudsters, and as a result, the full check amount of {$19000.00} was recalled from the Payer in XXXX as they had not authorized the check. I figured out the fraud when the Buyers tried to cancel the deal and tried to get the rest of their money back. At that point, I went to the police on XX/XX/XXXX, to report the fraud, and informed the Bank of the fraud. A police report was formally filed with the XXXX XXXX Police Department soon after, after the police confirmed the fraud did occur with a bank in XXXX, XXXX. And despite what the Bank assured me would not happen earlier, the full amount for {$19000.00} was recalled from my account by the Bank, and I was stuck with the loss. I lost the {$3800.00} which Chase urged me as my fiduciary to wire to the fraudster, but now the Bank is acting like weasels, claiming they had no responsibility in facilitating the fraud with their gross negligence acting as my fiduciary. On XX/XX/XXXX, the Bank formally denied any responsibility for their grossly negligent actions in urging me to go on with the deal based on their grossly negligent actions and advice as the fiduciary financial agents. They essentially guided me through every step of this deal, and I found out later that they failed to do their necessary due diligence in verifying the out-of-state check from XXXX for {$19000.00} XXXX which they just rubberstamped the payment overnight without any verification whatsoever. Thus, the Bank enabled this fraud to occur by negligently failing to do its due diligence in verifying a large out-of-state check that they were obligated to verify and clear before transferring any funds. They never even bothered calling the bank in XXXX from which the check was drawn from. I have been a customer of Chase Bank with a checking account, so I had to rely on the banks judgement in matters of banking which are beyond my XXXX, but they gave me grossly negligent fiduciary advice and even failed to do any due diligencewhich they are obligated to conduct as a fiduciaryon verifying the out-of-state check. Apparently, Chase Bank routinely fails to do any due diligence on out-of-state checks which is proof of per XXXX gross negligence, in and of itself. During my conversation with the Branch Manager at Chase, XXXX XXXX, on XX/XX/XXXX, he admitted to me and son, as a witness, that the Bank did no due diligence, but instead cleared the check instantly based solely on their longstanding relationship with the bank in XXXX, XXXX, from which the check was drawn from. Thus, the Bank admitted they were grossly negligent in their actions in enabling the fraud to happen by not doing their required due diligenceas stated and acknowledged on their websitefor verifying out-of-state checks that needs to take extra steps verifying the transaction in the amount of more than {$6700.00}. He also admitted that XXXX XXXX was grossly negligent by advising me and my son that the check was legitimate ; the funds cleared ; there was no way it could be recalled after obtaining the funds ; and because of all this, he recommended to go ahead with the deal without hesitation. This admission of widespread gross negligence by XXXX XXXX of the Bank clearing large out-of-state checks based on longstanding bank relationships, alone, impacts an entire class of defendantsother than just mewhich are all their other bank customers who deposit checks of large amounts where the Bank simply rubberstamps the verification step without ever doing any of its required due diligence as a fiduciary to verify checks that bank customers are relying on to check for fraud. This may be a per se violation for negligence on a class-action scale. Whether or not the Bank has a per se level of legal scrutiny, the Bank most definitely has a higher level of legal scrutiny in this case because they had a fiduciary responsibility to me when I asked them about the suspicious transaction to verify its legitimacy. They performed none of their required duties of care as a fiduciary. Thus, this case does not need to meet the full burden of proof for gross negligence above just ordinary negligence ; however, the Banks gross negligence was so egregious that even the higher burden of proof of gross negligence is still easily provable in this case. Firstly, the Bank demonstrated breach of duty of due care to me. The Bank had a legal responsibility to me as the financial fiduciary institution for banking issues involving handing my money in my checking account. As a fiduciary, they have a duty to provide accurate information, which they utterly failed to do with wrong information on the matters which they are considered to be the experts innamely in banking and check clearing. They had very conservative check clearing procedures in place for eventualities such as mine, but they simply chose to ignore them and cleared a large out-of-check with no due diligence whatsoever. Secondly, the Bank breached its duty of care and failed to meet its legal obligations. The Bank has expertise in banking matters, but failed to do any due diligence or use reasonable care in checking out the validity of the out-of-state check for {$19000.00}, as required and stated by its own policies, but instead they cashed the almost immediately in XXXX day by just trusting its longstanding relationship with another bank in XXXX from which the check was drawn from rather than doing any minimal routine due diligence. Thirdly, factual cause : the Banks misconduct as a fiduciary advisor actually caused injury to me because I relied on their advice and expertise in verifying the check in question. Had they not given me false assurances and erroneous information, I would not have wired any money to the Buyers and would have gone straight to the police, which I eventually had to do anyway. The Bank told me to go ahead with the deal with false assurances which violates their fiduciary duties. Fourthly, proximate cause : the Banks conduct was foreseeable to cause this type of harm by failing to do its obligated, routine due diligence of verifying the check in question, but instead, they rubberstamped it without any investigation. They simply failed to follow their own written procedures and the industry-wide accepted procedures for verifying large out-of-state checks which show gross negligence. Fifthly, I suffered actual damages of {$3800.00} in losses from the Banks grossly negligent behavior because I would not have gone through with this deal had I not relied on the Banks fiduciary advice to go ahead with the deal. In fact, they explicitly told me to go ahead with the deal. The Bank is ultimately responsible for not preventing this fraud from happening by their grossly negligent actions and conduct. Please note : there is a landmark, precedent federal case, Federal Trade Commission v. Neovi , Inc. d/b/a XXXX ( 604 F.3d 1150, 9th Cir. 2010 ), where the defendant, a check processing financial institution, was successfully sued by the federal government for enabling massive consumer fraud by having a profound lack of diligence in verifying checks which created a dinner bell for fraudsters. I dont see Chase Banks grossly negligent conduct as being any different than in the XXXX case.

Company response to consumer: Closed with explanation