Consumer complaint received 2024-11-12 00:00:00
Product: Checking or savings account — Checking account
Issue: Managing an account — Deposits and withdrawals
Company: CHARLES SCHWAB CORPORATION, THE
State: NY

Complaint narrative:
XXXX XXXX:
I got a text in the afternoon from Charles Schwab while at work asking me to confirm Y or N if Id tried to charge something at XXXX. I responded N. Shortly after that, I got a call from caller ID Charles Schwab and answered even though Im a teacher and was busy at the time, I wanted to make sure there wasnt fraud on my account. It was a hacker who was already in my account, but I unfortunately didnt catch on that it was a scam because he already was in my account and seemed to know everything he would need to know and had access to my account already. I realized he had called me, not the other way around, so told myself to be careful not to hand out any information. He was clearly already in my account and had all my information at that point because he had my name, address, phone, email, account numbers, debit card numbers for my personal and joint checking accounts (the last 4 digits at least because that was how he was referring to my two cards). I gave him none of this information. 
He again asked if I had made that XXXX  charge and I said no. He asked about another charge at Walmart and I said no. He then continued to go through charges and activity on my account over the last week, reading off my actual activity such as ATM withdraws, and transfers between my Charles Schwab accounts that were legitimate asking me to confirm with a yes or no if the activity was me or not. Because he had all this information and wasnt asking me to provide any personal information, like the last 4 digits of my social security number or my password, pin, security questions, etc., I still thought he was from Charles Schwab. He then said he could cancel my debit card because it had been compromised. He said hed have another one sent overnight to me. I agreed to this.
He said that there were attempts at wire transfers as well and asked if I approved those. I said no. He then said he was sending me some codes to read back to him so he could reject the wire transfers. I now know those were One Time Passwords, but at the time didnt think it could possibly be because, again, I didnt think anyone could possibly be in my account and have all my information unless they were from the bank. I also remember thinking that with only a code from a text, there was nothing anyone should be able to do without also having all my other information. Unfortunately, I didnt open the texts when they came through, I just saw the codes pop up as the first part of the messages in the text notifications (so the parts saying not to share them with anyone even if they claimed to be from Schwab, werent showing). This was obviously my mistake in this whole thing. Even though I thought I was being so careful not to reveal any personal information, I didnt understand how these codes could be used. I never have done a wire transfer and didnt know the process. He kept me on the phone while he actually then did the wire transfers I think, so I didnt see the emails come in via notification saying that my password was changed, 2 factor authentication was turned off, and the transfers were ordered. I dont check my personal email every day on busy weeks and didnt see these until the next day after Id seen the money removed from my account. He actually asked me if Id like email notifications turned back on because he said I had it off and I said yes and he said then Id be getting emails from the transfers being initiated but to ignore those because they were from earlier in the day when the fraud was attempted and then Id get more showing they were canceled. Of course then I only got the emails stating the transfers were initiated and later, completed. 
He told me that a fraud investigation would be conducted over the next 24-48 hours and my account would be locked for 24 hours, so that they could make sure nothing was transferred from my account and conduct their investigation and try and figure out where the logins had occurred for the fraud. He gave me a fake fraud investigation case number. He said not to log in to my account because it was locked and they were conducting their investigation and it would slow it down if there were logins from my actual location while they were trying to see where the fraudulent logins were from. Obviously this was a very well planned and repeatable type of fraud (in fact I was told by the fraud investigator at XXXX that they see this all the time). 

XXXX XXXX: 
I checked our bank accounts after work (my personal checking and our joint checking) in the evening and they had been emptied down to about $XXXX  total from about $XXXX. The money had been moved to my brokerage account and then transferred via wire out (from our joint brokerage account there were two wire transfers: $XXXX  and another for $XXXX  totaling $XXXX). We dont usually keep that much money in these checking accounts but were about to pay off a large credit card bill from a recent home improvement wed charged. Weve talked in the past about not keeping too much money in there since these accounts do have debit cards associated with them and we know that makes them less secure. We actually dont even carry the cards most of the time in our wallets, preferring credit cards for the added security. 
I called XXXX XXXX  that night to report the fraud. They said a fraud investigator would call me in the next two business days. They said they needed to lock my online account and that we could still use our debit cards (not that we would at this point after this happened knowing that the accounts are not secure and nearly empty). They didnt give me information beyond that and said the fraud investigator would have more information. I talked to my husband who was traveling for work but was able to talk me through how to check my XXXX  account to see if there were any logins from new devices or other places to see if that was where the security breach was. There werent any red flags in XXXX  - no password changes, no log ins from other devices, no history of anything odd. He thought my XXXX  account may have been the origin of the hack since they clearly had my password for my Charles Schwab account and I use XXXX  password manager for all my passwords (so I dont even know the passwords to any of my accounts because they are randomly generated and supposedly very secure). I updated my XXXX  password that would be needed to get into my password manager to make sure that stayed secure. 
At no point did anyone at Schwab say that they were even sorry this had happened to me or give me any series of events that would now occur to help me move forward. No responsibility was taken on their part at any point for the fact that  my account was hacked under their watch and on their website. 

Thursday, 5/9/24: 
I had to take the day off work to deal with this. While waiting for the fraud investigator to call me, I finished the factory reset on my phone that my husband had recommended I do for security purposes. The fraud investigator called me and asked how my day was going. I told him not well. He basically heard from me what happened and then said that they see this type of fraud a lot. He said this is a really common scheme and seemed to know exactly how this worked. I told him that I hadnt given the caller my information and that the man was clearly already in my account because he had all my information. He told me that they wouldnt cover our lost funds and that he could try and request the funds returned from the banks they were transferred to. I said that sounded unlikely to work but would fill out the paperwork right away that he was sending me for that, which I did. He gave me no other help in this matter and no other information, which was shocking and unnerving. I had no information as to how or when my online account will be unfrozen. I was left trying to figure out on my own which bills, like our mortgage, paid automatically from our account, when they each would try to draw funds and how to stop payments so we wouldnt over draft or get extra fees, late fees, etc from other institutions for the insufficient funds, all while being locked out of my account indefinitely. We spent all of XXXXy and XXXX dealing with the logistical details of this. On XXXX, we remembered that we had purchased the identity theft protection from XXXX this year and I gave them a call. That was the first time I felt someone was trying to help me and had a human response to my losing a huge amount of money. Nothing came of it in the end because it was ruled fraud and not identity theft, but at least they could talk me through things like freezing my credit.

XXXX XXXX:
I called Charles Schwab to find out our account balances and ask about when the freeze would be lifted since calling was the only access I then had to my accounts. The woman was eventually able to help me reset my username and password and remove the freeze from our account. She said they have requested the funds returned from the bank they were being transferred to but didnt have the result of that yet.

XXXX XXXX:
I had to call Charles Schwab again because I couldnt log in to my accounts still without a security code and couldnt receive a security code because I did a factory reset on my phone (as an added security precaution). Paul was able to get me into my accounts and was going to check and see how long the process usually takes for recalling the wire transfers since I asked what it was and he didnt know and I said there was no indication that there was going to be any more follow up from Charles Schwab and I wanted to know where we were at in the process. He called me back that night to let me know that the funds recall did not work and they had known that since XXXX  (it was XXXX). I asked why this wasnt communicated to me and he said that its all automated stuff in the system so theres nothing that would trigger them to contact me. I asked to see if the fraud investigation was still open and he said it wasnt. Again I stated it was odd to me that no one was communicating this information to me. I understand that I made a mistake in speaking to the scammer, but the bank account had already been hacked, which is not in any way my fault. 
A few weeks later, I called Charles Schwab and requested report of fraud with account numbers where the money was transferred and a reason why we werent being refunded our lost funds. They said itd post in 5 business days, it didnt. Then I contacted them via the website chat and they said the report was sent to my message center in my online portal, but it was not showing up in my message center so theyre said they were resending it right away to the message center. It still didnt appear. A week later it still wasnt there, so I called again and they said theyd email it this time. Now another 9 days has passed. I called again 10/29 and spoke with a representative named Angel, who couldnt find any reason why it wasnt being sent out, so was going to call me back within 48 hours to let me know when I could actually expect it to be sent to me so that I wasnt just waiting once again for it and not having it come. I told her I need account numbers where wires were sent for IC3 report and police report. 11/4, I still had no word. I called again that day and spoke to Conner in Denver. He told me hed talk to the investigator and put me on hold. Then he came back and said they wont be able to honor any of the letter requests unless it comes from law enforcement. They didnt tell me this at any point in my 4 previous requests for the report, instead they left me waiting for it to come repeatedly, wasting my time and making this process take much longer than needed. This is the first time Id been told that I cannot have the information Im requesting. He was going to speak to the fraud investigator to see if they could at least release the account numbers that the money was wired to. He said he would call me back but didnt. 
We generally dont use these accounts anymore due to the fraud and theft that happened with them, but left them open with a little bit of money in them while were trying to resolve this incident and there was additional fraud on our joint account on 10/16 & 11/4 coming from our new debit card, that I dont use because again, I dont feel this account is safe. These funds (totally about $XXXX) havent been returned yet, even after reporting them as fraud. Clearly I need to just empty this account because they are still unable to keep it secure. 
I cannot believe that my bank will not help me any further in this situation and I am out all of my money. It is hard to believe that when my account was hacked through no fault of my own, that I am solely responsible for what happened because I shared the codes after they were in my account. I wouldnt have fallen for the scam if the hacker wasnt already in my account because he wouldnt have had all of my personal information that made it obvious that someone was in my account. If they see this all the time how is anyone supposed to safely use online banking with them with any confidence. I am deeply embarrassed and ashamed that I gave away any helpful information to the scammers. I am also in shock that we lost such a huge amount of money and arent covered for that loss. I am angry with myself, the hacker/scammer, and Charles Schwab. The loss of the money is devastating and the way I was treated by them has been absolutely appalling. 
I am sharing exactly what happened, in hopes that you can use this information to prevent others from the same fate. No one should be in my position. This has been one of the worst experiences of my life. I have filed reports with the police and the IC3 as well. I should have more protection than this as a consumer. It seems that there should have been red flags for Charles Schwab when a new IP address, in a new location, logged into my accounts, turned off 2-factor identification, changed my password, moved almost all my money into my brokerage accounts that had never previously been used at all (because they were automatically opened with the checking accounts), and then transferred almost all my money out all within 48 hours. Where is the consumer protection in that?

Company response to consumer: Closed with explanation