JPMorgan Chase Sues Customers for $662K in TikTok Check Fraud Scheme.
JPMorgan Chase is pursuing legal action against clients involved in a widespread check fraud scheme that gained traction through viral TikTok videos. These customers, accused of fraudulent ATM withdrawals, may soon face substantial financial repercussions as the bank seeks repayment of nearly $662,000.
How the Scheme Operated
The alleged fraud involved customers issuing checks to themselves and withdrawing funds before the checks could bounce. Typically, banks allow access to a portion of deposited checks prior to clearing. However, a temporary error enabled these clients to withdraw larger amounts than usual before the checks processed.
Chase has filed lawsuits in three federal courts against four customers over this issue.
Key Case in Houston
One significant lawsuit, filed in Houston, involves a “masked man” who reportedly deposited a $335,000 check into a defendant’s account. This individual has the highest outstanding balance among the cases, totaling $291,000.
In each situation, Chase reached out to the defendants for payment of overdrafts and associated fees, but the bank claims these requests have been ignored, breaching the deposit agreement required upon account opening.
Financial Consequences and Legal Action
JPMorgan Chase is seeking the return of unlawfully accessed funds and demanding that defendants cover the bank’s legal fees and related expenses. Additionally, lawsuits have been initiated in federal courts in Florida and California.
“Fraud is a crime that affects everyone and erodes trust in the banking system,” stated Drew Pusateri, a Chase spokesperson. He highlighted the bank’s collaboration with law enforcement to address fraud and mentioned that Chase is open to pursuing further action against other potential fraudsters. As the largest bank in the U.S., with approximately $3.5 trillion in assets, JPMorgan Chase’s actions emphasize the seriousness of check fraud.
Related: Doctor Sentenced to Over 10 Years for $54 Million Medicare Fraud Scheme