[ale] OT - bank fun

Jeff Lightner jlightner at water.com
Mon May 14 11:58:49 EDT 2007 

Well as I said it happened in the 80s.   The bank involved of course
denied they did it and someone as poor as me wouldn't have had much luck
suing them - I'd probably still be in court today because that's what
big companies do.

My point was the law was changed much later (sometime between 86-90) to
expedite check processing.   They couldn't get away with it now because
there are time limits for everything.   The main reason for the time
limits were another abuse - your own bank telling you that you couldn't
have access to deposited funds until they were "collected" and then
making arbitrary rules about when it was considered "collected" which
often let them float money they'd gotten in wire transfer.   Don't
underestimate the value of interest on 3 days float of millions of
dollars.

Rather than depositing at another bank you do what I and my coworkers
did after the above incident.   We cashed the checks at the bank they
were drawn on - the bank has to cash it for you even if you're not their
customer.   Even if you had deposited the money in another account and
manually transferred it out you'd be liable for the returned check and
ALSO your own bank would charge YOU overdraft fees for paying out the
check you'd originally deposited.  

All that leads to another rant - why the hell you have to sign up to
allow funds to be withdrawn when you allow for them to be deposited via
direct deposit.   There ought to be a law with time limits for that as
well.  I once saw a person complaining that the contract agency he'd
worked for suddenly withdrew all the money they'd paid him when he was
working for them after he no longer did.  They used the flimsy excuse
that he hadn't submitted the proper time sheets but couldn't explain why
they had paid him all along without those time sheets.   It is one thing
to have a company make a payroll mistake and be allowed to correct that
within a week but quite another to allow them unlimited access.   Also
those agreements don't "expire" so once you move on unless you change
your account your vulnerable to shenanigans.



-----Original Message-----
From: ale-bounces at ale.org [mailto:ale-bounces at ale.org] On Behalf Of Bob
To: ale at ale.org
Toxen
Sent: Monday, May 14, 2007 11:42 AM
To: Atlanta Linux Enthusiasts
Subject: Re: [ale] [Fwd: Employment Advert] New Scam!!!

The bank may have violated the law.

*I* would have told them to honor *my* paycheck or I would charge
them with embezzlement, file a complaint with the Federal Banking
Commission, and sue them and then done so.  You probably would have
won the suit.

At the same time (or in the same suit) also name the
company which, clearly, has real estate.  Payroll gets second dibs
on a bankruptcy only to the IRS.

That being said, a similar thing happened to me when I was young and
naive.  Word to the wise: in such a situation deposit the check to
a bank account at a bank where you have NO other business.  As soon
as the funds are available withdraw in cash.

The bank is unlikely to try to sue you to get back your paycheck.  That
is what I SHOULD have done.

Bob

On Mon, May 14, 2007 at 08:56:50AM -0400, Jeff Lightner wrote:
> Having been a victim of the "intended" reason fro this rule I think
I'd
> be happy to keep it in place and let people that don't know "something
> that is too good to be true probably is" be burned by their own greed.
> 
>  
> 
> Prior to the rule banks could do things like hold checks and claim
they
> were NSF after the fact.   I once worked for a company where several
> successive paychecks were suddenly declared NSF all at once and
returned
> to my bank where I'd foolishly deposited them.   Why would a bank do
> this you ask?  Because the company had a mortgage and a payroll
account
> at the same bank.   They were in arrears on the mortgage so their bank
> simply waited until they'd deposited enough funds in the payroll
account
> (over a period of a few months) then used a little known law called
> "right of offset" and transferred all those funds from the payroll
> account to pay off the mortgage arrears.   Once they did that they
were
> free to send all the checks back as NSF despite the fact they had
> previously accepted them from the clearing house without comment.
> 
>  
> 
> The law that changed how quickly banks must process checks was a good
> thing because it prevented abuses like the above which were common in
> the 80s.  They even require target banks of scams to report fairly
> quickly so you don't find out a year later but somewhat more quickly
> when you've been a victim of such a scheme.
> 
>  
> 
> ________________________________
> 
> From: ale-bounces at ale.org [mailto:ale-bounces at ale.org] On Behalf Of
> Brian Stanaland
> Sent: Friday, May 11, 2007 10:57 PM
> To: Atlanta Linux Enthusiasts
> Subject: Re: [ale] [Fwd: Employment Advert] New Scam!!!
> 
>  
> 
> In another instance of unintended consequences, banks are obligated by
> federal law to either post funds to your account or declare checks
> unfunded within a specified number of days.  If the check hasn't been
> denied by the issuing bank they have to deposit the money.  When the
> check finally gets to the bank and bounces, which it will, YOUR bank
> takes the money back. 
> 
> Brian
> 
> On 5/11/07, Scott Castaline <hscast at charter.net> wrote:
> 
> Howard A Story wrote:
> > Sounds like.
> > http://en.wikipedia.org/wiki/Vladimir_Levin
> >
> > And there is some sort of IRS un-reportable limit??
> >
> >
> > Bob Toxen wrote:
> >> It can take as much as 1-2 months for your bank to discover that a
> check
> >> that you deposited and "cleared" really is no good and "ask" you to

> >> reimburse the funds.  The fine print in your banking agreements
> legally
> >> obligates you to this so if you have any net worth at all the bank
> will
> >> get it.
> >>
> >> If you resist they may charge you with criminal acts for defrauding
> the 
> >> bank.
> >>
> >> If you actually "get away" with such a scam, the IRS then will hunt
> you
> >> down.
> >>
> >>
> >> Advice:
> >> 1. Avoid any such offer to be a middleman in handling funds.  If it

> >>    were legal and easy they either would do itself or work through
> >>    a legitimate bank, lawyer, etc.
> >>
> >> 2. Avoid any "generic" ad of any type.  Note that this one said 
> >>    "your state/county/country" rather than "DeKalb County, GA".
> >>
> >> 3. If it is a legitimate bill, it can be handled via U.S. Mail
> >>    for $0.39.  If they need you either it's a scan or you're being 
> >>    hired for "Collections," which is a HARD job as the consultants
> >>    on this list know.
> >>
> >> Bob Toxen
> >> bob at verysecurelinux.com                [Please use for email to me]
> >> http://www.verysecurelinux.com        [Network&Linux/Unix security
> consulting]
> >> http://www.realworldlinuxsecurity.com [My book:"Real World Linux
> Security 2/e"]
> >> Quality Linux & UNIX security and SysAdmin & software consulting
> since 1990.
> >>
> >> "Microsoft: Unsafe at any clock speed!" 
> >>    -- Bob Toxen 10/03/2002
> >>
> >> On Thu, May 10, 2007 at 09:46:54AM -0400, Jim wrote:
> >>
> >>> James P. Kinney III wrote:
> >>>
> >>>> I got pounded with these last night. 
> >>>>
> >>>> -------- Forwarded Message --------
> >>>>
> >>>>
> >>> Clark Howard has talked about this one.  Seems you get to cash
phony
> >>> checks/money orders  and forward the funds to the company.  Then a
> while 
> >>> later you find out the checks are no good.  That's a real
> opportunity
> >>> alright!
> >>>
> >>> Jim.
> >>> _______________________________________________
> >>> Ale mailing list 
> >>> Ale at ale.org
> >>> http://www.ale.org/mailman/listinfo/ale
> >>>
> >> _______________________________________________ 
> >> Ale mailing list
> >> Ale at ale.org
> >> http://www.ale.org/mailman/listinfo/ale
> >>
> >>
> > _______________________________________________ 
> > Ale mailing list
> > Ale at ale.org
> > http://www.ale.org/mailman/listinfo/ale
> >
> uhh according to the article Levin would have been 14 unless my eyes
and
> 
> math have really slipped in my old age. It says he was born 1980 and
he
> started this in 1994.
> _______________________________________________
> Ale mailing list
> Ale at ale.org
> http://www.ale.org/mailman/listinfo/ale
> 
> 
> 
> 
> -- 
> 
> "Anyone who has the power to make 
> you believe absurdities has the power 
> to make you commit atrocities."
> 
> -- Voltaire
> 

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