Forget Monopoly: a banker’s mistake in your favor almost never works out well.
Experts say some people who try to take advantage of the viral ‘Chase Bank outage’ could face serious consequences, including frozen bank accounts, negative balances of thousands of dollars — and even jail time.
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The outage, highlighted in several viral TikTok videos, led some people to believe they could get “free” money from Chase JPM ATMs. According to the reports, customers were able to deposit a check made out to themselves for an amount greater than their bank account balance at at least some Chase ATMs, giving them immediate access to some or all of the money on the check.
Banks can sometimes take several days to verify checks before depositing money into customers’ accounts. But in the case of the “Chase Bank outage,” some or all of the money on the deposited check was available immediately, allowing people to withdraw the money before the checks were identified as fraudulent. Online reports showed that some of these fraudulent transactions amounted to as much as $40,000.
As you might expect, the bank took action after reports of the “glitch” surfaced on social media. Chase said the issue was “addressed” and urged people not to try again.
“Regardless of what you see online, depositing a fraudulent check and withdrawing the funds from your account is simply fraud,” a Chase spokesperson said.
Legal and accounting experts agree. “The intent to do this is nothing short of fraud,” Dr. James Mohs, an accounting professor at the University of New Haven, told MarketWatch. “Depending on the severity of the fraud, penalties can be imposed at the state or federal level or both, and can range from fines to imprisonment. The facts and circumstances will determine the severity of the penalties.”
And some of the people who did this could face serious penalties, depending on the state they’re in and the amount the check was written for. Here’s an example of how these penalties for check fraud can play out in New Jersey, according to criminal defense attorney Kevin Conway.
|
Check amount |
Attack |
Prison sentence (up to) |
Nice amount |
|
Less than $200 |
Disorderly persons |
6 months |
Up to $1,000 |
|
$200-$1,000 |
Fourth degree |
18 months |
Up to $10,000 |
|
$1,000-$75,000 |
Third degree |
5 years |
$15,000 |
|
More than $75,000 |
Second degree |
10 years |
$150,000 |
The above mentioned charges are only for check fraud. Depending on the case, other charges may be added to the actions of a person.
“If they take the money, take the money, don’t give the money back, then it becomes criminal,” Conway said. “If they brag about it, that they know it’s a mistake, [then] it’s a big theft. It doesn’t take much to become a crime.”
To be clear, not every bank error is a criminal offense. “I’ve had cases where the bank accidentally deposited money into someone’s account,” Conway said. “That’s OK, that’s not a crime in and of itself.”
But you Doing must give that money back. “If you spend it and don’t give it back, or take it to a higher level like people do here, where they realize it’s a problem with the system, [then] “It becomes a bigger problem because your actions are deliberate,” Conway added.
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How could people really think they could get away with such a move, especially after sharing it on social media?
“When it comes to intentional fraud, people’s motives are always confusing and defy logic and are difficult to justify. Fraud is fraud, regardless of whether the amounts are small or small,” Mohs said.
Are people actually going to jail over the Chase Bank outage? It depends.
If someone does not pay back the money, he or she may face severe penalties, as it is up to the financial institution to determine whether a criminal report has been filed.
JPMorgan Chase declined to comment on possible criminal referrals.
“First degree and second degree is an automatic state prison sentence, the ranges are high. Third degree and fourth degree, you can get local time or probation with local time. It’s not good,” Conway said.
But the charges can also change.
“If you manage to get a lesser sentence, you can appeal to the second degree and receive sentences up to the third degree.” [degree]then you would potentially have no prison. It’s all negotiable,” Conway said.
But jail time isn’t the only punishment that could be faced by those who exploited the glitch. Many users who uploaded videos of themselves performing the “free money” hack later posted photos of their bank accounts showing massive negative balances, sometimes in the tens of thousands of dollars, after Chase withdrew the stolen money from the accounts. Other people who attempted to exploit the glitch reported having their bank accounts seized.
“This Chase glitch s***, don’t do this man,” said one person who claimed to have tried the glitch in a follow-up video, with his account showing a negative balance of $10,997.58.
