Nigerian Email Scam Victim Sues Bank, Loses Appeal

reidhellyer writes "From California Litigation Attorney Blog: 'While many victims of the so-called "Nigerian e-mail scam" would be too embarrassed to trumpet that fact, others end up infamous for their victimhood like the appellant in a published opinion of the California Court of Appeal in Riverside. In March 2009, Charles Peters received an email from someone purporting to be a citizen of Malaysia. The e-mail informed Peters that certain third parties in the United States and Canada owed the Malaysian money, but that “they can not transfer the funds to any bank account outside America continent due to their new company policy [sic].” He asked Peters to “assist me in receiving the funds and forward to me.” He offered to pay Peters 12 percent of the money. Peters agreed after apparently negotiating an increase of his fee to 15 percent.'"

Comments

Duh...

[Ismellpoop]

You would think by now people would be wary of anything from Nigeria or other African countries.
And if someone can't get their money from the bank there is probably a damn good reason.

Re:Duh...

[knacjesus]

because malaysia is anywhere near africa ???

Re:Duh...

[Anonymous Coward]

You are correct in the second sentence (and also, the saying "if it seems too good to be true ..." applies). However, as to the first, it was purportedly a Malaysian national, and a Hong Kong bank received the money.

But fundamentally, it's a classic case of greed overcoming caution. I don't think we'll ever see an end to tales like this.

Re:Duh...

[antifoidulus]

Greed and abject stupidity. Seriously, why would the "victim"(aka mark) think that the person emailing him could not find a bank willing to transfer money for a 15% cut? Most banks transfer a lot more for a lot less money and are a lot more reliable than some random dude you email.

Re:Duh...

[pete6677]

A fool and his money...

Re:Duh...

[nbauman]

Well, in his defense, Maylasia isn't in Africa. http://en.wikipedia.org/wiki/Maylasia

When a bank tells you a check has cleared, that's only provisional subject to final clearance. Who knew?

Re:Duh...

[slashqwerty]

it's a classic case of greed overcoming caution.

If you read the article you will notice the victim tried to be cautious. He deposited the check into his bank account. He later verified with the bank that the check had cleared. Only then did he wire funds out of his account. Sometime later the bank revoked the checks claiming they had been altered. Since the victim did not have any money to cover the lost funds the bank attached a lien to his property.

It was actually the bank that lost money. The bank is trying to collect from the victim. The victim sued the bank to have the lien removed from his property. He lost, and lost again on appeal.

Frankly, I think it is the bank that should be held responsible here. They are the ones that verified the check was good, that it cleared, that the funds were in the victim's accounts, and they are the ones that allowed the funds to be wired out of the country. Ultimately, the bank will be held liable since they will never collect their $468,000. But they are all-to-happy to do whatever they can to ruin the victim's life in the process.

Re:Duh...

[sjames]

I'm not so sure the banks don't share in the blame. After all, they tell people the checks have cleared knowing damned well that most people don't know they might yet yank the money back out for a wide variety of reasons. In this case, the bank was more than happy to transfer a huge chunk of cash from the man's account, far more than he had ever had in there until the recent checks that had "cleared". Now it wants to take it out of his hide rather than pulling it back from the transfer.

The LEAST they could have done is told him when he checked that it was cleared was make sure he knew that didn't mean it couldn't be pulled out again. One lousy sentence out of a teller's mouth could have saved this guy half a million dollars worth of pain.

Yes, he should have known it was a scam (it's not just well known on sites like /., the local news has stories about it from time to time as well), but surely the banks should be VERY well aware of the scam and should at least make a minimal effort to warn their customers.

Re:Duh...

[Kjella]

Of course the people that fall for this are rather naive, but the banks give a good helping hand in fucking you over. If the money is shown as in your account and the bank confirms the check cleared, what are people really supposed to believe? Most people have never heard the words "provisionally cleared" until the bank slaps them with a half a million dollar lawsuit. This is a very common fraud method, other variations is that they somehow "overpay" you and trick you into sending part of the money back or to pay some fraudulent transport company or whatever. In rare cases they'll even try to buy goods and recieve them before the check bounces. Fuck that, the banks should be forced to either clear the check or bounce the check and eat the loss themselves exactly once. If they have to bounce many checks, tough shit. It can't be that hard to set up something like a WU branch office in Nigeria that'll let you send money if you've paid them with real cash and not phoney baloney checks.

Re:Duh...

[cvtan]

Generally you don't know and they won't tell you. Of course the victim is a moron, but the bank allows these things to go on because they tell you the funds are available before they really find out if the check is good. A check from an overseas bank might take weeks to properly clear. So how long should you wait? I have no idea and banks don't notify you when the check is found to be good; they only say something if it's bad.

Re:Duh...

[Technician]

The scammers are well aware of the Flash money that vanishes when the bogus deposit fails to clear much later.

Unfortunately, there are too many that are not aware of this and get taken.

Re:Duh...

[Kjella]

IUnfortunately, that's not how the bank thinks. The bank thinks "He used a false check to get money that wasn't his into his account". That he was in turn acting on behalf of a Malaysian fraudster who has run away with parts of the money is not relevant to them, the bank has never given the Malaysian any money. As far as they see it, the fraud was perpetrated by him against his bank account, and that's what they'll recover it against.

As long as you have the insane clearing system as you have, it has to be this way otherwise you could imagine the reverse scam where they collaborate, the bank has to eat a loss of $500k and then the two of them split the profit of $250k each. The sane solution would be a single and final clear/bounce, where the bank eats any loss. That'd probably lead to damn many checks bouncing at first but serious money transfers would adapt quickly and say "this is now the only way the US take payments".

Re:Duh...

[antifoidulus]

So what are you proposing as an alternative? That the banks wait until each check has totally cleared(taking weeks or longer in some cases) to totally clear? What about the vast, vast majority of the cases where the check does clear? Should everyone else be forced to wait weeks so morons won't have to suffer the consequences of their own stupidity?

Re:Duh...

[Opportunist]

And even if not, because banks (yes, even in central Europe, which used to be THE place to go with your dirty money before a certain Island took over) tend to be wary of money laundering investigations, who in their right mind thinks that someone with a few billion bucks to shove around needs the aid of someone they don't know at all? People with billions of bucks at their disposal tend to have patsies they can use for that. For far, far less, I should probably add.

How greedy can you be to think they need YOU? That just elevates stupid to a whole new level.

Re:Duh...

[Jeff DeMaagd]

I recall a story several years ago when one of the biggest group of people suckered by these scams were accountants and people in similar financial professions. In short, the people that are in a position to know better than anyone else, but they're more likely to be suckered by the 409 type of scam.

Re:Duh...

[Kjella]

Oh yeah, and I should add to that.. the world needs to get out of last century. I've never written a check in my life, it's all plastic or cash. Debit cards go directly against your account and is far more practical and fraud-safe than checks without the high costs that cause shops to refuse taking Visa etc.

Re:Duh...

[darthwader]

So what are you proposing as an alternative? That the banks wait until each check has totally cleared(taking weeks or longer in some cases) to totally clear? What about the vast, vast majority of the cases where the check does clear? Should everyone else be forced to wait weeks so morons won't have to suffer the consequences of their own stupidity?

I assume that is exactly what the poster is proposing, and it is a damn good idea. The bank does not have to FORCE everyone to wait, but they should not say "the cheque has cleared", and then later say "sorry, the cheque has un-cleared, we want that money back."

It's OK for the bank to give you access to the money before they have it, but they should be 100% clear about the possibility of they clawing the money back. They should tell you that it is "provisionally clear" when you are allowed to take the money out but there is a chance they will ask for it back, and they should tell you it is "clear" when they are completely confident that they money is there and you can safely spend it. And once they have told you the cheque is "clear", then they have taken the risk.

Banks could do a lot more to prevent fraud, but they don't have really strong financial incentives to, because most of the banking laws are designed to push the risk from them to you. Why should they care when they aren't the ones losing the money?

Re:Duh...

[John Hasler]

> He later verified with the bank that the check had cleared.

No. He verified that the check had been credited to his account subject to collection. Decades ago the bank would have postponed crediting his account for such a large, unusual item until after they had collected from the bank it was written on, but current law does not allow them to do that. This scam is a direct result of that law.

Re:Duh...

[sjames]

There is nothing at all in the law that prevented the bank from telling him it was "cleared" but still subject to being pulled back. One sentence is not too much to ask in the name of customer service and could have saved a lot of grief.

Re:Duh...

[Anonymous Coward]

I am a Nigerian ... I am shocked that people still fall for 419 scams. Every year many greedy people (the so called victims) fall for this utterly stupid trick. The bait is cast far and wide and some fool believes it ... if it sounds too good to be true, then it is.

That said, having traveled to Nigeria, I have seen some large condos built from the proceeds of this thing ... though those that make money also get entangled from their own criminal activities ... in the end crime does not pay.

x

Re:Duh...

[EdIII]

We could see an end to it very very simply.

The bank is the one in possession of all the information. No to mention they have the requisite sophistication to understand the entire process, check clearing houses, etc.

A bank customer understands one thing, and one thing only, the money is available . The answer is simplicity itself. If the bank says the money is available they are entirely liable by law.... done. None of the Nigerian scams will work anymore because the bank always ends up rejecting it.

What we lose as customers is a little convenience. However, we could get a little bit back by allowing these courtesy provisional credits for less than $2,000 or a provisional credit of up $5,000 dollars can be issued for checks coming from an account with a minimum number of successful clearances, consecutively, and from U.S banks only.

Re:Duh...

[outsider007]

Yeah but then you don't get reward points. Also bitcoin ftw.

Re:Duh...

[cacba]

The check has cleared, yep thats final clearance as well. Double secret final clearance, well now that you ask there seems to be a 3 week hold on the check for irregularities.

This issue goes beyond Nigerian scam, a paypal payment can appear in your account but later be reversed days afterwards. How many ebay sellers wait a week to ship after payment? Certainly not me.

Re:Duh...

[Anonymous Coward]

Yeah, I mean it's not like some Bank would refuse to transfer money to some group/organization/company that's totally legal and not charged with any crime just because they don't like them.

Your talking crazy talk like this is Bank of America refusing to let you send money to WikiLeaks or something.

Oh. wait. I guess US Banks do sometimes do exactly what the scam says.

Re:Duh...

[1u3hr]

what are you proposing as an alternative? That the banks wait until each check has totally cleared(taking weeks or longer in some cases) to totally clear?

Yeah, why not?

Why the hell should it take weeks? Why not 10 seconds for your bank to verify with the issuing bank -- they don't send messages by pony express any more, it's all digital. When it can make them money, they do the transaction in less than a second, keep it and play with it while you're waiting.

Re:Duh...

[gfody]

Regardless of the fact that they told him otherwise, since the check hadn't actually cleared, the bank basically allowed him to overdraft his account by $400k and then took his home to collect the debt. The whole Malaysian scam thing is irrelevant. Does this bank let all of its customers overdraw 6 figures? I think this guy, his lawyer and the bank are all dumb as shit.

Re:Duh...

[DragonWriter]

So what are you proposing as an alternative? That the banks wait until each check has totally cleared(taking weeks or longer in some cases) to totally clear?

Yes, banks -- which routinely delay availability of funds until checks have "cleared" -- should not say that checks have "cleared" and make funds available if the check has not, in fact, cleared.

If banks wish to provide additional service to their customers and make funds available when checks have not cleared but some preliminary and potentially inconclusive checks have passed, they should clearly distinguish to customers when this is the case rather than a check having actually cleared, particularly when the customer explicitly inquires as to the status of the check so that they do not take action based on a mistaken impression of the validity of the check.

Re:Duh...

[afxgrin]

The insane thing is that they accepted a cheque for $500k. A fuckin cheque? Are you kidding me?? You'd think for that sum of money they would require identification, registered addresses, multiple signatures, and some other bullshit. I couldn't even deposit $100 into a friend's bank account at a bank without providing some form of photo ID. The bank deserves to be scammed.

Re:Duh...

[Firehed]

If that were the case, banks would never clear inter-bank payments over $500 or so until the entire window where the payment can be charged back has elapsed. That means all your large funds transfers take three to six months to clear (bad) or the window in which you can dispute a payment shrinks (bad). By overhauling our arcane and dilapidated ACH system to work more like how our credit networks function - specifically with regard to real-time authorizations - we can eliminate a lot of the big problems without creating a whole new set. Scammers would need access to a bank account with enough funds to cover the amount of money their scam involves and also allows debiting funds into arbitrary accounts. This gets rather fiddly when you're talking about international transfers, but if I'm going to dream about improvements to the ACH network I might as well go all the way with it.

Re:Duh...

[Pence128]

Don't be ridiculous, they bailed themselves out. They just used your money.

Re:Duh...

[mysidia]

If you read the article you will notice the victim tried to be cautious. He deposited the check into his bank account. He later verified with the bank that the check had cleared.

The problem is that's not "being cautious" or the victim does not understand what "cleared" means; "cleared" items are only really certain to go through if they are bonafide, and the paying bank is solvent. If he were being cautious, he would have required a bank wire or certified funds, or he would have understood the paying bank has a RIGHT of CHARGE-BACK, and waited longer.

He would at the very least understood the "cleared" merely means the check was presented for payment and payment acknowledged by the paying bank, does not mean the funds are guaranteed, or that no issues are going to be raised, if the item is reviewed, or fraud is suspected.

The paying bank can change their decision and reject the transaction at any time during the settlement period according to local laws, after the check cleared.

Under the law, banks are not responsible for negligence, errors, misconduct, or default, by the other bank or other parties to the transaction.

The unavailability of funds to cover the invalid instrument is not the depositor bank's responsibility, it is up to the victim to seek recourse against the writer of the invalid check, and the initial "clearance" of the item does not relieve the depositor of liability.

Obviously, as can be seen here, "Cleared" means only that the transaction has cleared the banks' books, and provisional settlement of the transaction is completed; in his haste, he neglected to wait the longer waiting period, to ensure the item dispute period had sunsetted, and obtain confirmation of final settlement of the transaction.

Re:Duh...

[mysidia]

There is nothing at all in the law that prevented the bank from telling him it was "cleared" but still subject to being pulled back.

Of course it would be nice customer service... but he should not rely on it.

Bank customer service went down the toilet a long time ago when regional banks started getting consolidated by these faceless national conglomerates.

If you want to be safe legally, you need to know something about the law, or consult with your lawyer. If 500,000 grand is on the line, it seems appropriate to at least have a quick conversation with one.

Bank tellers definitely are not required to inform you of all your legal rights, or warn you about any risk(s) you might be running into.

Re:Duh...

[Kjella]

don't forget the other side to that. if banks eat the loss, then costs of transfers would go up, and/or banks will refuse to do transfers. It'll also go back to the previous mechanism where transfers take lots longer to clear (weeks or even ,onths) before money is available. and direct deposit goes out the window, too.

I imagine by "direct deposit" you mean businesses mailing in paychecks to be paid to employee accounts or something like that? The whole problem with checks is that you have to match what's deposited with what's issued. I can go into my online bank now and issue a payment today and it'll be in your account in the morning, fully settled between the banks. That money is gone, has left my account, left the bank and isn't coming back unless I sue you to get it back. My paycheck comes straight to my account each month like clockwork the same way, it's settled the same night it's transferred into my account. That way all the instructions come from my account and I can't transfer money I don't have to do frauds like this. It's a lot harder taking control of my bank account that uses a code calculator than it is to make a piece of paper that looks like it came from my bank with a signature that looks like mine, after all I've signed quite a few places.

Sure, you can claim there's a few advantages to checks, but most of them are negated in that who really trusts a check that hasn't cleared? By the time it's cleared - the provisionally cleared you talk of here - you could have gotten yourself to an online bank, a telephone bank, a bank office and had the money electronically transfered or found an ATM and handed over cash. That is if you're not carrying around a cell phone capable of the same, usually you need a small code calculator as well but it's all pocket size. And if you have a terminal you don't even need that, the offline solution terminals use is pretty much like checks, you use the card, id and signature. That way it's up to the business to decide if they want things online, for example most taxis are now online so they know if you can pay the taxi ride or not or if the card is reported stolen. It's not quite that easy to issue an APB of a stolen checkbook, don't accept these checks.

Re:Duh...

[nbauman]

He doesn't sound quite as dumb as the blog post made him out to be.

If I deposit a check, and the bank tells me on the phone or in writing that it cleared, as an ordinary non-financial person I would assume that the money is secure in my account.

A bank has a greater knowledge of these matters than its consumer customers, and therefore a greater obligation.

My bank should be serving me and making a reasonable effort to look after my interest and avoid fraud.

The bank should know that these scams are going on. They should know that some of their customers are likely to fall for them, thinking that they've deposited valid funds.

The banks could stop this fraud by making it clear to their customers that even though the check has cleared and the money has been entered into their account, the entry is just provisional.

I think a bank has an obligation to do so.

So the victim had a reasonable case against the bank. He might have won if the courts decided that way. They didn't.

So now this fraud will go on.

Re:Duh...

[JustNiz]

It still amazes me why none of the morons that fall for this ever seem to wonder why, out of the millions of people in the world, whats so special about themselves that some previously unknown foreign VIP in charge of millions would specifically contact them with such an "amazing opportunity".

Re:Duh...

[trawg]

Banks could do a lot more to prevent fraud, but they don't have really strong financial incentives to, because most of the banking laws are designed to push the risk from them to you. Why should they care when they aren't the ones losing the money?

Maybe some sort of global financial meltdown will wake consumers up to that fact and they'll start voting cleverly for reform!

Re:Duh...

[mysidia]

Why the hell should it take weeks?

Because it can take the account holder weeks to get their statement, see that someone has presented a fake check against their account, and cause the transaction to be dishonored. If this happens, the depositor who deposited the bad check doesn't have the right to the money, even if their account had been credited.

Being "totally clear" is not about moving money permanently; that is final settlement, when the bank says your check cleared they mean it has passed provisional settlement. Being totally clear is about agreeing to move money, and there being no issues.

Since it can take days before a review occurs or issues are reported, 10 seconds is not reasonable for settlement to occur. Even credit card transactions do not make provisional settlement so quickly, it takes 24 hours, and of course is not final until approximately 60 days, before that time the CC issuer has CHARGE-BACK rights, just as the bank paying a cheque has a CHARGE-BACK right.

Re:Duh...

[JWSmythe]

    There's nothing that unusual about a $500k check. They get floated around when homes are bought and sold.

    If (for example), I had a home worth $750k and I only owed $250k on it, upon selling it, I'd get a lovely $500k check.

    Cheno and Riverside are in the Los Angeles area, and it's perfectly reasonable to for that to happen there. Hell, when I was out there, you couldn't buy a shithole 1br house in a dangerous neighborhood for $300k. That was before the housing bubble burst, but still...

    There are other legitimate reasons for it. Large business deals including selling a business.

    The bank really should have taken better precautions, *AND* I'm sure they were insured for such losses. They would rather put the burden on the customer than hand it off to their insurer, or risk their own money. I don't believe FDIC covers this type of loss.

    As for the bank's own money, they make a fortune on their depositors and on loans. That money doesn't go much farther than the bank and the shareholders. $500k is a drop in the bucket for most banks. That bank in particular in Q1 2010 made $7.2 million, with total assets of $110.8 million. Yes, they could have afforded to protect their customer. It's not in their best interest though. They'd rather hit the customer for the losses.

    The guy, who was dumb for doing it, should really have won. No, he shouldn't gain anything from it, but the bank should be hit with punitive damages. They won't be though. They have the money to buy their way out of trouble.

    From the bank's perspective though, it could have been a scam on HIS part. If I doctored up a check, deposited it in my account, and then sent most of it off to a friend in another country, and then said I had no involvement when the check bounced, who's to know who the real thief is.

    Since they aren't seeking criminal charges against him, I'd suspect they don't really think he was involved to gain from it.

Re:Duh...

[sjames]

I realize it's not legally required, but perhaps it should be. Either way, the fact that the banks practically NEVER warn people that "cleared" doesn't mean what practically the entire non-bank employed population thinks it does goes a long way to showing that banks are becoming a cancer.

Re:Duh...

[LingNoi]

Seriously dude, do we pay for everything with checks? No, in fact checks are becoming obsolete for the very reason that you have to wait for them to clear.

With that said and forgetting that BitCoin is a pyramid scheme; why do you think BitCoin would be any better? It has all the problems of checks and none of the benefits.

Re:Duh...

[LingNoi]

In England they seem to do this to some extent. When I take out 1000+ GBP in cash the bank asks you politely what it was for. Some people might take offence to that but they're simply making sure you're not about to give it all to some scammer.

Re:Duh...

[grahammm]

It's not quite that easy to issue an APB of a stolen checkbook, don't accept these checks

True, but it does not have to be an APB. Only the issuing bank has to have the information so that during the clearing process it can tell the bank presenting it that it is stolen, fraudulent or there are insufficient funds to cover it, Then it will not clear. The problem here is that the victim checked that it had cleared, by which time, IMHO, it should be too late for the bank to reverse the transaction.

Re:Duh...

[Kagetsuki]

I'm glad I live in a country that uses transfers and not checks. We do have a system somewhat similar to checks but it's nothing more than a wire transfer order.

Re:Duh...

[scribblej]

They are 100% clear about this. It's a part of the NACHA standards. It's typical to get the funds in your account the day after a check is wired to the Fed. But it's a very clear part of the standard that the recieving bank has 3 (IIRC) days to return an "NSF" and the customer has up to 60 days to dispute the check, and if either one happens, the funds are immediately pulled from your account. This is all part of the documented standard.

Re:Duh...

[Fizzl]

Hubris.

Re:Duh...

[Dahamma]

it's a classic case of greed overcoming caution.

If you read the article you will notice the victim tried to be cautious.

So? It's still greed overcoming caution. He was somewhat cautious, but still much greedier...

Re:Duh...

[mysidia]

doesn't mean what practically the entire non-bank employed population thinks it does goes a long way to showing that banks are becoming a cancer.

Practically all the population will never submit a check that provisionally clears but then gets dishonored instead of being paid. Most people are just interested in knowing they have access to the money, so they can make withdrawls.

It's kind of like going to the doctor for a checkup and having him tell you "You have a clean bill of health". Of course that's no guarantee you have no dormant disease and won't get sick the next day.

I assume the outliers are so rare that the banks would deem it a waste of time to try to clear up a misconception that has such a highly technical inaccuracy that rarely matters, assuming the bank employees that talk to the customers even understand.

Re:Duh...

[billcopc]

That was my reading as well. The bank explicitly told the account holder that the cheques had cleared, but then changed their mind. I thought the whole point of the clearing process and delays were to verify the validity and liquidity of a cheque.

As much as it offends me to side with the gullible fool, I think he took the proper precautions. Keep appealing until the bank loses, this is an abuse of power. The main reason 419 scams continue to thrive is because banks mislead their customers in a false sense of security. If the cheque clearing process were functioning as expected, this victim would have gotten stuck with a few bounced cheque charges, but at least he wouldn't have been duped into wiring almost a half-million dollars to a fraudster.

If you really want to get literal, the victims bank and those upon which the cheques were issues "conspired to commit fraud" since the 419 scammer got his cash, as a direct result of the banks incompetence.

Re:Duh...

[billcopc]

The insane thing is that in 2010, we still use cheques. Everyone has cards, account numbers and PINs and smart chips. Even the cheapo pizza delivery joints around here take debit cards right at your door.

I can pay someone halfway around the world in four mouse clicks and a few keystrokes, why can't people pay local businesses as conveniently and securely ?

Numbers on a piece of paper are OBSOLETE!

Re:Duh...

[matunos]

Here's a question: he's never met this Malaysian in person. He finds himself holding a half million dollars in his account, and now the Malaysian is dependent upon him to send him his supposed due.

Why send it?

Re:Duh...

[Kjella]

The problem here is that the victim checked that it had cleared, by which time, IMHO, it should be too late for the bank to reverse the transaction.

Yeah, that's exactly what's not happening. The banks can take the money back up to two months after deposit. Taking unknown checks is economic extreme sports with no safety net.

Re:Duh...

[Rural]

No, direct deposit means the company transfers money (an employee's salary) directly to the employee's account. No checks involved. Prevalent in Europe--there's really no other common way to get that (legal) salary payment. Really, aside from novely checks, checks here no longer exist.

Re:Duh...

[sjames]

Do you know what you call a doctor if he pronounces you "perfectly healthy" but what he really means is there's an odd spot on your lung but it almost never turns out to be a rapidly developing cancer?

The defendant.

In other words, unlike the doctor, the bank KNEW that it was only provisionally cleared but chose not to inform the man of that rather important bit of information. It sounds to me like exactly the sort of "let's not worry about the impossible" that lead to the big financial meltdown.

Re:Duh...

[91degrees]

That means all your large funds transfers take three to six months to clear (bad)

But this would be so bad that the banks would work out a new system that is much lower fraud risk and doesn't have the delay. Money is a good motivator. Someone will work out a way

Re:Duh...

[Anne Thwacks]

I thought the whole point of the clearing process and delays were to verify the validity and liquidity of a cheque.

You are the type of gullible person the bank likes as a customer. The delay is so they can embezzle your money on the forex trading market for a few days, which they generally lose money on, hence the need for huge charges to recoup their losses.

They lie about it, which is "obtaining pecuniary advantage by deception", and they all do it, which is "conspiracy to defraud". However, they bribe the government and you don't, so they get away with it.

In Zambia, the government bribes you. How is life in Soviet Russia?

Re:Duh...

[Anonymous Coward]

This is why, in this day and age, we need some financial instruments that aren't utter crap. Checks are utter crap! Credit cards are utter crap! Oh wait, they fixed the security issues with credit cards by adding three extra numbers and putting them on the _back_ of the card. Oh, well, that fixes everything. Crap! Utter shitty total crap! Electronic checking using the account and routing number printed on every check you hand out? Crap!

It should be no surprise to anyone that the banks and financial institutions are utterly, utterly incompetent. This ruling is a terrible, terrible ruling because, as stupid and greedy as the victim was, the way the bank handles checks is the only reason this scam _can_ work. They will never fix the problem if they can simply hold others accountable rather than swallowing the costs themselves.

If anyone challenges this and points out how difficult things are for the poor, poor banks, let me point out how easy it is to work around these problems. Provide every customer of banks, credit card companies, etc. with a smart wallet type device that all of their credit cards and bank accounts can be loaded into. Give the device some sort of authentication system, maybe biometric, maybe just a password (or set of passwords with different capabilities). Load it with secret pre-shared keys for each account (technically it could just be one key, but in this day and age, with the storage available, you could load them up with enough keys to use a unique pre-shared key (one time pad) for every single transaction for millenia worth of transactions. Design the devices so that the keys can be loaded in at the branch office, but never output in any way (yes, someone could steal it and strip the keys, but then they would have to kill or kidnap the owner to get the device and crack it before it could be reported lost or stolen). When a transaction is made, the device, and not the point of sale system, uses all of the details of the transaction (amount, current date and time, name of the entity the transaction is being made with, _not_ the password of the device, but maybe a second secret password if more security is desired, heck, maybe even GPS coordinates and a still from a security camera built into the POS system) encrypted with the secret key, unique or not, and sends that through the POS system to the bank. It would also work for transactions done without instant communications (equivalent to those credit card imprint devices you just don't see anymore) by encrypting against the time (possibly, if there aren't simply unique keys for every transaction, using a pre-shared secret table and algorithm requiring particular keys to be used at particular times and dates, making it extremely unlikely for even someone who had cryptographically broken a person's previously used keys to fake a transaction), and possibly maintaining a record of transactions on the device and having it sync frequently with the bank (by way of computer connection, or maybe even a built in cellular network device) to ensure that the pretty strong cryptographic system hasn't been compromised. This could also work for checks by requiring a bit of extra writing on the check: date plus hours minutes and seconds (read off the clock on the electronic wallet device) along with a code provided by the device after a similar cryptographic transformation like it does for credit card transactions based on the amount of the check, the time, and the check number.

There. No more fraudulent transactions barring major leaks from the bank themselves. People would still be vulnerable to good old fashioned force, but fraud would be squashed. Where it could still occur, liability would be obvious. If you gave your ewallet and your passwords to someone, shame on you. In the real world, people would sometimes need to do that and just rely on trust, so make the ewallets able to be set with temporary passwords allowing access to only certain accounts and limited to certain amounts. If you gave away authorization to access an amount like $8

Re:Duh...

[M1FCJ]

They are still pretty popular in UK but the amount of places accepting them is going down daily. I'm down to my last checkbook and probably I will not bother replacing it.

Re:Duh...

[Anne Thwacks]

this guy, his lawyer and the bank are all dumb as shit.

Ther is no law against being dumb. There is also no law against banks lying about checks being cleared. Banks are above the law if it suits them. That is life. Get over it.

Re:Duh...

[Anne Thwacks]

Nothing to do with scammers. The bank is required to report to the thought police. The British overnment wants to know what you are doing, why you are doing it, and how you are doing it, so they can store it on computer files which they lose, and end up in the hands of scammers..

Re:Duh...

[kasperd]

I think in some cases it is not because they cannot see through the scam, but rather because they think they are safe. Consider that they receive all the money first, and then they transfer part of it on. It is not like they are paying somebody money before receiving their own share. But then after they have received money (possibly from a victim from internet banking phishing) and transferred part of that money to an account abroad, the original transfer is reverted.

Somebody who is in that position where they thought part of it through but forgot the part about the first transaction being reverted will have to play stupid. They cannot admit that they had some idea what was going on, because then they would admit to have deliberately taken part in the crime. Playing stupid may be unlikely to get your money back, but with a bit of luck it may save them from a sentence.

Not saying this is necessarily saying this is what happened in this case, just saying that these people may not be as stupid as it looks. One saying goes: "Never attribute to malice what can adequately be explained by incompetence", another saying goes: "Any sufficiently advanced incompetence is indistinguishable from malice". But in some cases it may actually be a combination of malice and stupidity, and it can be hard to tell how much of each.

Re:Duh...

[serutan]

The sane solution would be a single and final clear/bounce, where the bank eats any loss

That would require personal responsibility on the part of the bank, and as we all know, personal responsibility in the finance world is a customer-only kind of thing.

Re:Duh...

[Dan541]

Since, the bank accepted a faulty Cheque I agree they should be the one's to ware the losst. If a store accepts a faulty bank note from an innocent customer then it's the store that takes the loss when the original forger can't be found. The customer is at best an unwilling participant especially if they were to ask the store to verify if the cash was ok.

Yes, a cautious idiot is still an idiot. But this guy is really a victim of the bank, they deceived him into accepting the cheque as genuine.

Re:Duh...

[Krneki]

Exactly.

When I was selling my bike I got a scam email in my Inbox. Since I was curious to see how the scam works I played along for a while. I received a check covering both my bike cost and the sanding fees. I checked the Internet to see where the scam is and I noticed that I'll get scammed from my bank.

You take the check to your bank, they validate it and give you the money. A couple of months later they will claim the money back, since the check is not valid and held you responsible.
I can't understand why a regular person should be held responsible for a false check when the professionals (bank) didn't find out the check was not valid.

Re:Duh...

[kasperd]

Why send it?

They send him a cheque, they know where he lives. For all he knows a group of big Malaysian men could show up at his door. If he kept the money it would also be harder to argue that he was not deliberately taking part in fraud.

Re:Duh...

[jimicus]

That was my reading as well. The bank explicitly told the account holder that the cheques had cleared, but then changed their mind. I thought the whole point of the clearing process and delays were to verify the validity and liquidity of a cheque.

You'd think so, wouldn't you? Similar thing happened to my wife on ebay - accepted a cheque, banked it, waited the three business days it was supposed to take to clear, verified with the bank it had definitely cleared before shipping - and then it bounced two weeks later. It turns out that when a bank tells you a cheque has cleared, what they don't tell you is they mean "subject to a whole lot of other things which can still happen".

She was totally unaware of this, as was I. And this was in the UK...

Re:Duh...

[St.Creed]

Heh.

We use the same system in The Netherlands. Checks are completely antiquated ofcourse. But you know what? International bank traffic can have the ability to revoke wire transfers as well. So one day the money is in your account and you hand over the carkeys. The next day the car is gone to Poland or Russia and a week later, the wire transfer is cancelled. And if you already spent that money on a new car, the bank will happily put your account in the red with a 19% yearly interest rate attached.

Don't think that wire transfers from dubious banks in Russia or Africa are much better than checks. You could get a very nasty surprise that way.

Re:Duh...

[Compaqt]

But why should there be a 3-6 mo. dispute period? Make it binary.

Money in account? Y/N. If Y, payment cleared for sending to recipient bank. Otherwise N.

Period.

Or if the sender bank wants to wait a few days and call their accountholder before sending the money, fine. But verify, and confirm, or deny.

Re:Duh...

[Compaqt]

OK, so the clearance is provisional.

So why does the bank allow funds to be depleted from the account?

That's the dumb part.

Re:Duh...

[matt4077]

The least they could do is abolish this insane idea of sending around cheques to transfer money.

Re:Duh...

[matunos]

That's what PO boxes are for. ;-)

Re:Duh...

[Peeteriz]

That's how commonly used payments work everywhere else (Europe except UK, Asia) - all settlements are final and that's it.

Re:Duh...

[Chapter80]

I recall a story several years ago when one of the biggest group of people suckered by these scams were accountants and people in similar financial professions. In short, the people that are in a position to know better than anyone else, but they're more likely to be suckered by the 409 type of scam.

You'd think the maintenance people would be more likely to get caught up in 409 Scams. We seriously need to clean this mess up.

419 scams probably hit a disproportionate amount of Toledo residents.

Re:Duh...

[Kagetsuki]

You are talking about what we call TT. Here (in Japan) the system is internal to Japanese banks - there is no such thing as revoking a transfer. When the money is in your account it's there and that's it.

Re:Duh...

[kasperd]

That's what PO boxes are for.

Yeah, I suppose you wouldn't worry about somebody showing up to be beat the hell out of your PO box. But it doesn't give you a better case when you are being sued for fraud (or whatever is the legal term for this). I also suspect the malaysian may think twice before sending the cheque to a PO box, they might actually realize that if the address is a PO box, they are dealing with somebody who has got a clue. Then again, not all scammers are too bright.

Re:Duh...

[St.Creed]

Ah *that* is pretty cool - I didn't know that they had this in Japan. Yes, that makes a lot of fraud much more difficult - good system!

Re:Duh...

[nospam007]

"I can go into my online bank now and issue a payment today and it'll be in your account in the morning,"

Morning? WTF are they doing? Do they print everything out and people in the backoffice doing everything by hand and then they call it online banking?
Are they investing your money for 24 hours?

I'm in Europe and my bank is a normal bank and the money will be in your account just after I press [Enter].

I used my last check somewhere in the late eighties.

Re:Duh...

[DMiax]

If the bank thinks it is a scam they should sue the guy, not take his money away. If truly the bank cleared the check it means they guaranteed the money was there he had all the reason to think he could use it. Let's say he spent on a car and the bank finds it is a false check after clearing, no third party involved, they would sue him for fraud. He should have won this case.

Re:Duh...

[Registered Coward v2]

Do you know what you call a doctor if he pronounces you "perfectly healthy" but what he really means is there's an odd spot on your lung but it almost never turns out to be a rapidly developing cancer?

The defendant.

In other words, unlike the doctor, the bank KNEW that it was only provisionally cleared but chose not to inform the man of that rather important bit of information. It sounds to me like exactly the sort of "let's not worry about the impossible" that lead to the big financial meltdown.

Uh, no. In the first case the MD has a legal responsibility to practice within the normal standards of his profession, just like any other licensed professional. The bank is following the law; and the account agreement a person signed probably explained the clearance process. While I think the bank should have at least informed the person about the clearance process for such a sum of money or at least inquired due to the unusual nature of the transaction, the are not legally bound to do that.

Re:Duh...

[Mark Hood]

I'm not sure how true that is, but they're definitely required to get you to fill in a form for anything over £10,000 - to avoid money laundering (which this would come under).

I had an inheritance last year, and it couldn't be paid electronically in one go, for this reason, so they transferred £5,000 a day until it was all paid in.

The bank wrote to me on day 3, to offer their advice on how to invest it (while stating that if I already had plans for it, not to worry) and when I called them on an unrelated matter even advised me that leaving it in the current account was 'not the best place'...

So maybe they're looking out for me, maybe they're looking out for trouble coming their way, but my bank at least did a decent job of it.

Mark

Re:Duh...

[DrXym]

I think if banks were 80% liable for all frauds that we might actually see a banking system that took the necessary precautions to prevent scams like this. There must be things that can be done by the receiving bank and the sending bank to reduce the amount of fraud. Phasing out paper cheques would be a good start.

But in the absence of bank regulation, anyone stupid enough to be processing fraudulent cheques is largely to blame for their own misfortunes. While this guy is as much a victim as the bank, it was his own sheer stupidity which initiated the fraud and he should be on the hook for any losses that result.

Re:Duh...

[gnasher719]

I assume that is exactly what the poster is proposing, and it is a damn good idea. The bank does not have to FORCE everyone to wait, but they should not say "the cheque has cleared", and then later say "sorry, the cheque has un-cleared, we want that money back."

Case 1: I get a cheque for $500,000 from a company that is totally legal, solvent, and so on.
Case 2: I get a cheque for $500,000 from a scam artist.

The bank obviously cannot know initially which one it is. The time they need to absolutely irrecovably clear the cheque to the point where nobody in the world can get the money back from the bank will be the same, whether it is a legal company or a scam artist. However, the legal company probably didn't give me the cheque just for fun. For example, they might have given me the cheque so that I put new carpets into their huge new office building, and I need money to pay for the carpets, I need money to pay for the employees, so I need to be able to spend the $500,000 as early as possible. I can't start working until the bank gives me access to the $500,000.

So what do you think should happen with the first cheque? To be honest, if I received a cheque for $500,000 and was supposed to send $425,000 to someone else that I don't know, I would go to the bank and ask "Is the cheque cleared"? When the answer is "Yes", I would then ask "Is there any way whatsoever that you could ask me to return the money"? And if the answer is "No" I would then ask "Can you give that to me in writing"?

Now obviously I would _not_ get that statement in writing. And then I would draw the consequences.

Re:Duh...

[cvtan]

There is a comment on the original article site that clarifies this: >>I’m surprised, not only that neither party spotted the UCC issue, but also that neither the parties nor the Court of Appeal spotted Federal Reserve Regulation CC that requires banks to credit the full amount of a deposited cashier’s check within one business day (12 CFR 229.10(c)(v)). Banks are liable under the regulation for failure to use ordinary care, 229.38(a), and may refuse credit if there is a factual basis to doubt the check’s collectibility, but a bank may not refuse to immediately credit a cashier’s check on grounds of possible uncollectibility “based on the fact that the check is of a particular class or is deposited by a particular class of persons.” 229.13(e) . Regulation CC supersedes the UCC. 229.41. Comment by Mike Stone>> So there is a government rule that requires that the money be made available to you within a certain time regardless of whether the bank likes your face. Sounds fair. Banks manage to screw up the good intentions by not telling you the acceptance is "provisional" and never telling you when the check REALLY clears. Do we need a rule covering that as well? Then banks will react by doing something else tricky and certainly not behaving in an honest and straightforward way.

Re:Duh...

[_vSyncBomb]

There is still a lot of fraud, though. It comes the opposite way around: the fraudster tricks granny into wiring him some money. Whoops! It really is non-revokable, so granny's money is gone. In recent years there are signs and stickers warning about this at most ATMs.

(Still, I think it is clearly better than the reverse case. Just pointing out that fraud will find a way.)

Re:Duh...

[xaxa]

Non-cheque settlements are final in the UK too, the same as the rest of Europe.

If you want something like a cheque but secure, you can get a "banker's draft", which is essentially a cheque from the bank, i.e. the bank takes £1000 from your account, then gives you a cheque for £1000 made out to whoever you specify from their account.

Re:Duh...

[Peeteriz]

The point was that pretty much everywhere else 100% settlements are non-cheque settlements and people there don't really use anything like a cheque. USA and (partly) UK are only large markets where cheques are still seriously considered.

Re:Duh...

[Anonymous Coward]

> or consult with your lawyer. If 500,000 grand is on the line,
> it seems appropriate to at least have a quick conversation with one.

What, so he can take 10% as a "fee" whilst relaying some "advice" that his paralegal found on Yahoo Answers?

There is never an appropriate time to have a conversation with a lawyer.

Re:Duh...

[lingon]

Why, yes, I *always* read the NACHA standard documents before doing any transaction with my bank, don't you? Seriously though, the parent has a very valid point that 1) the wording is very badly chosen and 2) the banks have no incentive to fix it. These kinds of frauds are a big problem and, even though you feel that everyone that falls for it are dumb, it would probably be a good thing to at least try doing something about them.

Re:Duh...

[MoonBuggy]

I didn't realise that these scams sometimes worked in that manner - what's to stop the potential victim from taking the entire amount in the form of a cashier's cheque and jumping on the next flight to Switzerland or the Cayman Islands to deposit it somewhere out of reach?

Re:Duh...

[superposed]

The bank thinks "He used a false check to get money that wasn't his into his account".

This is exactly right. All the bank knows is that this guy deposited some bad checks in his account and then asked the bank to transfer some money overseas. The bank followed his instructions and later discovered that the checks he had deposited were bogus (had been altered). They credited the bogus checks back to the original account, and then where were they supposed to turn to collect the value of those checks? Back to the guy who deposited them of course.

Now the case is between him and the person who gave him the bogus checks (in exchange for a real transfer to Malaysia). That's not the bank's problem -- they were asked to transfer funds to Malaysia and they did so. They certainly can't reverse a successful wire transfer just on his say-so. Maybe he can get some sort of judgment in a U.S. court and instruct the bank to yank back those funds from Malaysia (if they're still there)?

Of course the bank could have made life easier by inspecting the big unusual checks more closely before crediting them to his account, or advising him that the original account holder might challenge them as fraudulent. Maybe there should be a statue of limitations for fraudulent checks (e.g., 60 days), after which you can be sure they were genuine and won't be pulled back?

This does suggest that we should all be doing direct transfers rather than writing checks. There's no way to verify immediately (or even within 20 days) that a check hasn't been altered in transit (or written fraudulently). At least with a wire transfer, the originating bank can check your credentials before they transfer the money.

Re:Duh...

[MoonBuggy]

If the banks aren't properly verifying these transfers before making the funds available, how the hell are they operating? It seems shady, at best, that the series of events should be anything other than "Sending bank checks sender's account and immediately debits necessary funds; sending bank transfers funds to receiving bank; receiving bank deposits funds in receiver's account". Let the banks both play with the money in short term investments for a day or so, if you must, but I still fail to see how the system can be altered in such a manner that the transfer becomes invalid after the fact, rather than simply bouncing as 'non-sufficient funds' immediately.

Re:Duh...

[lingon]

At least here in Sweden (and I'm guessing it's mostly the same across the world), most banks run all their inter-bank transfers during the night, starting sometime after midnight. If I wire money to an account in the same bank that I have or to a bank that my bank has a special agreement with, it will be deposited immediately, otherwise (which is the normal case, especially so when paying bills) it will only be transferred during the night to the next bank day. Where do you live do get that kind of service, how did you get your bank to actually replace the antiquated IBM systems from 1980 running all backends? :)

Re:Duh...

[MoonBuggy]

The time they need to absolutely irrecovably clear the cheque to the point where nobody in the world can get the money back from the bank will be the same, whether it is a legal company or a scam artist. However, the legal company probably didn't give me the cheque just for fun. For example, they might have given me the cheque so that I put new carpets into their huge new office building, and I need money to pay for the carpets, I need money to pay for the employees, so I need to be able to spend the $500,000 as early as possible. I can't start working until the bank gives me access to the $500,000.

A very reasonable point, but shouldn't that time be about 24 hours, in either case, rendering the distinction moot? The receiving bank contacts the issuing bank, the issuing bank either irrevocably debits the issuing account or informs the receiving bank that there are not sufficient funds available to proceed, the receiving bank then either credits the receiving account or informs the customer that the cheque bounced. What part of the 'backend' process takes any longer than the day or two that the normal clearing process takes anyway?

So what do you think should happen with the first cheque? To be honest, if I received a cheque for $500,000 and was supposed to send $425,000 to someone else that I don't know, I would go to the bank and ask "Is the cheque cleared"? When the answer is "Yes", I would then ask "Is there any way whatsoever that you could ask me to return the money"? And if the answer is "No" I would then ask "Can you give that to me in writing"?

Agreed - this guy may not have been as stupid as the average 419 victim, but he still made mistakes. I do, however, think the blame is, at the very least, to be shared with the bank in this case (and it's not often that I have any sympathy for some idiot who thought Prince Njembe considered him the best financial broker for the job); a reasonable person would believe that if a bank says a cheque is cleared, the money is now yours to use, despite what some arcane and little-known regulation might have to say on the matter.

Re:Duh...

[Lord Byron II]

This is America - even on purely electronic transactions, the bank withdraws it from your account on day 1 and then submits it to the recipient's account on day 3/4/5. In between, they have extra money in their account, which they use (in the form of loans, etc) to make extra money.

Meanwhile, banks only want to do business with you if you have direct deposit and if you use online banking, because the last thing that they want you to do is use cash.

Re:Duh...

[blincoln]

Oh yeah, and I should add to that.. the world needs to get out of last century. I've never written a check in my life, it's all plastic or cash.

I still use mostly checks to pay bills. I'd like the convenience of electronic payment of some kind, but not in the current implementation where businesses have saddled it with a bunch of baggage that allows them to continue leaching funds directly from customers whether the customers want them to or not. When I was younger, I learned the hard way that it's a lot easier to refuse to send a company a check than it is to get them to refund money they've already yanked out of your bank account.

Re:Duh...

[martyros]

The bank should know that these scams are going on. They should know that some of their customers are likely to fall for them, thinking that they've deposited valid funds.

At least some banks do. After I finished school, I worked remotely for a company in California for about a year as an independent contractor, which involved me billing them every two weeks and them mailing me a check. A couple of times, just based on the financial situation (or me being a day late in billing and having no paycheck for another two weeks), I had to ask the cashier if they'd make the money available immediately (i.e., not wait for the check to clear). They'd seen small-time check-caching scams before ("I'll buy your junker car for $1000, here's a check for $2000 write me a check for the difference"), so always asked if I was sure the check would go through. "They always have" seemed to be enough for them to let me take the risk if I wanted to.

But yeah, seems like saying "it's clear" when it wasn't really clear is totally messed up. The guy may have been thinking, "It's probably a scam, but what the heck -- if the check doesn't clear, I won't give them any money. What's the risk?"

Re:Duh...

[gnasher719]

Agreed - this guy may not have been as stupid as the average 419 victim, but he still made mistakes. I do, however, think the blame is, at the very least, to be shared with the bank in this case (and it's not often that I have any sympathy for some idiot who thought Prince Njembe considered him the best financial broker for the job); a reasonable person would believe that if a bank says a cheque is cleared, the money is now yours to use, despite what some arcane and little-known regulation might have to say on the matter.

There are three parties involved, the scammer, the victim, and the bank. The victim was _exactly_ as stupid as the average advance fraud victim - he believed an idiotic story that someone was willing to give him about $100,000 or so in cash for very little work. Believing this is idiotic. The bank didn't know about the circumstances. Doesn't matter what a reasonable person would believe; a reasonable person wouldn't believe the story in the first place. A reasonable person could have gone to their bank manager and found out more about the situation. And then they would have found out how this fraud works. It wasn't the bank which believed the scammer, it was the victim. He's only got himself to blame.

Re:Duh...

[TheRaven64]

Cheques are pretty rare in the UK. I've written a total of about four cheques in my life. The last time I wrote one was 7 years ago for the deposit on a house I rented (the rent was paid by standing order). That said, my understanding is that the transaction is final once the cheque clears and the bank won't put the cleared funds in your account until the originating bank has verified the cheque and produced the money, which is part of the reason that cheques take several days to clear.

Re:Duh...

[TheRaven64]

I don't know how it works in your country, but in the UK you typically pay bills by direct debit. This is covered by the direct debit guarantee, so you can revert payments easily and the company then has to recover the money some other way. I can cancel a direct debit with a single click in my online banking page and the company can then no longer take funds from my account.

Re:Duh...

[TheRaven64]

No, direct deposit means the company transfers money (an employee's salary) directly to the employee's account

You wouldn't use DD for this, it is a system which lets you authorise someone else to remove money from your account. Anyone can deposit money in your account as long as they have the account details, DD is used for paying bills. Your salary typically comes in via a standing order (which anyone can set up to pay any other account a fixed amount on a regular basis).

Re:Duh...

[TheRaven64]

Really? I took out £1050 in £50 notes (more £50 notes than I'd seen in total in my life before) to pay some builders and they didn't ask me what it was for, although they did suggest I should move some money out of my current account into my savings account. When I bought my house, I discovered that there is a limit of £10K per transaction on electronic transfers (unless you use some expensive thing), so I had to do several transfers to pay the deposit - amusingly, they flagged the last one as potentially suspicious and so it took an extra two days to clear while they 'investigated' it.

Re:Duh...

[Peeteriz]

IIRC, the UK has a semi-recent law limiting 'final clearing' of cheques to 6 days, but in USA it still is allowed to treat it as 'semi-cleared' and possibly invalidate it for as long as the bank wants, which may be months for international cheques.

Re:Duh...

[metalmaster]

I learned that lesson over a few months worth of payments as well. I had an autopay set up with my cell phone company, because it was $10 or so cheaper. The first month was debited the day my bill was due. The second month was taken 2 days beforehand. Still not a big deal, because i made sure the money was there. The third month....they took the payment a week early. I quickly cancelled that auto-pay. I had a hassle with the bank because of an overdraft. It was settled, but still a bitch. Now i pay with a debit the day its due.

Re:Duh...

[krovisser]

You know, when you sign up for a bank account, you are signing an agreement on how they handle deposits, checks, etc. That, and you endorsed the back of the check, saying "I trust this person/entity". The shits on your lap now if it goes sour.

Re:Duh...

[kalirion]

So why the hell don't they just charge back the transfer to the scammer???

Re:Duh...

[sjames]

You must be Ferengi!

Re:Duh...

[lwsimon]

I'm an American, but I think my British English is good enough to translate.

I'd tell them to "bugger off".

Re:Duh...

[Antisyzygy]

Another explanation is that the average person would find it fishy to be asked to set up a bank transfer out of the blue when they have no credentials to do so, whereas an accountant or financial adviser would probably have their name out there and expect someone to possibly seek their help with a bank transfer.

Re:Duh...

[sjames]

I have never in my life received an explanation of the clearing process from a bank in any form.

I am aware that the bank didn't actually break the law, but I do think customer service should be a bit better than just not actually illegal in most states.

Re:Duh...

[Antisyzygy]

I agree the bank should be held responsible. If its possible to forge checks/money orders/cashiers checks then they are flawed devices and the responsibility to verify they are legit is up to the institution that forces their customers to use them. It was their fault they specifically said it was legit and the money was in his account. Im not saying this guy isn't an idiot, as he should have been aware of this type of scam since its too random and also common. Likewise however, a bank probably deals with this sort of scam regularly enough that they should be informed and should be more cautious with these money transfer devices. Understandably they may have some reason to believe this man was trying to do something illegal, however since its been proven time and time again that these people are being scammed a reasonable judge should remove the lien.

Re:Duh...

[mysidia]

So why the hell don't they just charge back the transfer to the scammer???

In reality, probably because the scammer convinced the victim to pay them using a faster transfer method than cheque, or one that had fewer protections, such as an international next-day wire. By the time the banks realized something was wrong, the payment was already unable to be recovered.

If the victim wrote a cheque and signed it, the instrument is valid, and could not be charged back on the basis of being altered or forged, because it was not.

Check charge-backs are not as liberal as CC charge backs. A check cannot be dishonored due to defective merchandise, for example.

Checks can be dishonored because the instrument was forged, not signed by the correct person, or not endorsed properly.

Checks cannot be dishonored after the fact because the signer had a change of heart and wants the money bank, or found out they don't have the money to pay after all.

Re:Duh...

[arkenian]

So here's the problem with this: (From personal experience)

Someone steals my checkbook without my knowledge (we won't get into how). They write several thousand in checks to themselves. I find out next time I look at my statement. Those checks have cleared to another bank. Should my bank not be allowed, when I come in and report check fraud, to attempt to collect that money back? Otherwise the fraud perpetrator gets to keep the money? (actually he cashed them, so he got to keep the money anyhow, but you get my point.) Now you can make an argument that the bank should eat this, given that the signatures weren't even remotely close, but why should the perpetrator get to keep the money?

Re:Duh...

[Jason Levine]

If I recall properly, it works like this:

You get "paid" for something with a check made out to much more than the amount you should have recieved. Let's say $1,000 instead of $100. The scammer tells you there was a mix-up and that you should just deposit the check and wire $990 back to them. Perhaps they'll be "generous" and let you "keep" some more to pay you back for your time and effort. So you deposit the check and wire the money. Then the check bounces and the $1,000 gets pulled out of your bank account. Now you're down $990 or so which is firmly in the scammer's hands.

The point is that the money was never really there. It was an illusion concocted to get you to send your actual money to the scammer.

Of course, this is a different scam than the "give us your bank account information and we'll deposit 15% of $10,000,000" scam.

Re:Duh...

[makomk]

There's nothing that unusual about a $500k check. They get floated around when homes are bought and sold. If (for example), I had a home worth $750k and I only owed $250k on it, upon selling it, I'd get a lovely $500k check.

Really? Here in the UK, that's all done by electronic bank transfer. Has been for decades, IIRC.

Re:Duh...

[CookieForYou]

I will be royally pissed if this idiot turd makes the banks change their rules to wait for 2 weeks after the posting of a check.

Understand? There's two options.

1) Post checks rather quickly, assuming that most are good, and letting you take a bit of the risk

2) Hold on to all checks for 2-4 weeks before releasing the funds, royally screwing people like landlords, or any other business or individual who collects checks and then needs to use those checks to pay other expenses.

Your idea is terrible. You can't have you cake and eat it too.

Re:Duh...

[CookieForYou]

Yeah, good reason to use only "insured" services like PayPal or government/bank cheques for online transactions.

Re:Duh...

[rahvin112]

Ignorance of the law is NEVER an excuse that will work in court. You might argue it's not fair, which is what your post is (a great big whine), but that doesn't change the fact that you are using a system and are completely unaware of how that system works. That should scare you, and it should scare you even more that you think someone else is somehow responsible to tell you how the system you are using works when it's a published standard.

Re:Duh...

[MoonBuggy]

That much I understood; my immediate reaction was that if a 'nonexistent' $1000 can be transferred on in that manner, then surely it could easily be used to defraud the banks? If, rather than sending the money on to the scammer, the 'victim' withdrew the money in a cashiers cheque (or even a suitcase full of notes, I guess) and disappeared, surely they can keep the money as long as they can hide (or avoid extradition) and the bank is screwed?

Obviously not worth it for your $1000 example, but with a few million the payoff could be worth it to many, surely?

Re:Duh...

[SleazyRidr]

I really don't understand why it would be any other way. You give someone money, it's now theirs. How can you then go and grab that money back?

Re:Duh...

[hodet]

I suppose its possible but then they have made the leap from stupid to criminal.

Re:Duh...

[FrigBot]

Not if he's in Euroland where they use commas for decimals. If that is the case, and also if they measure their dollars in thousandths, then 500,000 grand could be 500000 "dollars".

I had meant for the above to be funny. Which it isn't.

Re:Duh...

[modecx]

One reason this scam works is a federal law (Expedited Funds Availability Act) which forces banks to make some amount or all of the funds available the first day, and all within two business days--as long the deposit is not over $5k--which makes it follow different rules. The funds magically appear in your bank account, ready for you to spend--giving you the false impression that the check actually cleared. You see, even in this electronic age of instantaneous information, checks clear at a snail's pace. Even electronic checks take 5-10 days to truly clear the clearing house, regular checks can take remarkably longer.

So, you write a check which comes from a legitimate account, and it has money, it clears, the money is moved around. The clearing house rejects the check you deposited, your bank takes the money back out of your account, and you're either hurting or worse yet, you've gone into overdraft mode, so the bank can kick you while you're down. The whole thing is, the financial system still works like it did back when horses and carriages roamed streets. Stupid, stupid, stupid.

Re:Duh...

[David Chappell]

Ignorance of the law is NEVER an excuse that will work in court. You might argue it's not fair, which is what your post is (a great big whine), but that doesn't change the fact that you are using a system and are completely unaware of how that system works. That should scare you, and it should scare you even more that you think someone else is somehow responsible to tell you how the system you are using works when it's a published standard.

While I believe the client has some responsibility to be well informed about the nature of the services he is using, the professional (in the case the banker) has some responsibility too. In this case it is the banker who is not allowed to be 'ignorant of the law'. It is the banker who as a professional must conform his conduct to technical and ethical standards. He also has a responsibility to deal honestly and frankly with his client. It is not proper for him to use excuses such as, "If you had read the relevant technical standards governing my conduct, you would have known that what I said could not have meant what it sounded like I said."

Many of those commenting here believe that if the bank really did use words which would lead a reasonable person to believe that the bank on which the check was drawn had received it and accepted it as genuine, then the bank should bear the loss. This is not a wholly unreasonable position. After all, if you can't trust your banker, whom can you trust?

As to the implied suggestion that we should all have read the NACHA standard, I don't know what to say. Should we, before shopping at a store, investigation all of the possible laws and regulations that the owner may be obeying just to make sure none of them adversely affect our interests? Do we have to read and understand the National Electric Code before accepting a bid from an electrician? If I hire a lawyer when buying a house, do I have to double-check his work too? Where does it stop?

Re:Duh...

[kasperd]

If, rather than sending the money on to the scammer, the 'victim' withdrew the money in a cashiers cheque (or even a suitcase full of notes, I guess) and disappeared, surely they can keep the money as long as they can hide (or avoid extradition) and the bank is screwed?

Withdrawing a small amount of cash is fast and easy. Withdrawing a large amount is more involved. That may get delayed for long enough to notice the fraud.

Also, if you run with the money, they know who you are, and it will probably look like you were doing the fraud on your own. The people who manufactured the original forged cheque in this story would probably not stand up and say, hey that was our forged cheque and we want those stolen money.

It would have to either be a hell of a lot of money, or the life you were leaving behind would have to be pretty worthless, otherwise I'd say it wouldn't be worth it. How much does a new identity cost? (Does it come with a warranty against being blown?)

Re:Duh...

[superdave80]

Does it come with a warranty against being blown?

Is there someplace to sign up for the warranty guaranteeing to get blown?

Re:Duh...

[1u3hr]

Because it can take the account holder weeks to get their statement, see that someone has presented a fake check

Why doesn't the bank notice that the cheque is fake? Isn't that their job? When it inviolves hundreds of thoudans of dollars, thay should take a little care.

Being "totally clear" is not about ....P Yeah, yeah. I understand how the bank gets away with this bullshit by making a distinction that defies common usage. They're in the right, legally. Morally, they're no better than the scammmer.

Re:Duh...

[1u3hr]

Stupid fingers. I get used to forums where I can correct my typos. Should have been:

Because it can take the account holder weeks to get their statement, see that someone has presented a fake check

Why doesn't the bank notice that the cheque is fake? Isn't that their job? When it involves hundreds of thousands of dollars, they should take a little care.

Being "totally clear" is not about ....

Yeah, yeah. I understand how the bank gets away with this bullshit by making a distinction that defies common usage. They're in the right, legally. Morally, they're no better than the scammer.

Re:Duh...

[Kagetsuki]

Precisely. And there is no way I have ever heard of to undo a transfer, so if someone tricks you all you can do is file a police report and hope you can get them on criminal charges.

Re:Duh...

[oldspewey]

as long the deposit is not over $5k

... which brings us back to GP's question: How was this dude able to wire close to half a million dollars someplace before the fraudulent nature of the cheques was discovered?

Re:Duh...

[serutan]

Actually some pretty good music comes out of Nigeria. Especially if you like jazz.

Re:Duh...

[modecx]

See, that's the idiocy of the system. The Expedited Funds Act requires for deposits over $5,000 availability of $5000 2nd Business Day Following Deposit, Remainder 7th Business Day, and payments between financial institutions get preferential treatment above and beyond. You could deposit some insane check, and have the funds available on the 8th business day.

You would think with an account who had no history of moving such large sums of money, that someone from the bank would have called the other bank to verify--but checks like these to accounts like these are routinely delivered by third party underwriters.

The bottom line: the financial system needs a gigantic enema, and needs to be rebuilt anew, with modern behavior in mind, from the ground up. If large sum paper checks, cashiers checks or money orders exist at all, they should be effectively treated as an instant transfer of funds when they hit a depositing bank, and they should be cryptographically signed by the issuing party, along with a routing numbers and verification of the amount issued, encoded into something like a data matrix or aztec code.

Re:Duh...

[DaVince21]

Europeans, Asians and Indians can't be really bad at geography now?

Re:Duh...

[scribblej]

This thread isn't closed yet, but I accept the diminishing probability this comment will ever be read. Just to set the record straight, I was just pointing out what no one else in the thread had; this IS a standard and shouldn't really come as a surprise.

I think in a perfect world, the bankers would be familiar with these standard and know when to tell a customer the facts. In actual fact, most bank employees you will ever have contact with are low-wage automatons who don't know the business any better than you do. And the 'back office' people generally aren't any better. At any large company there's a tiny handful of people who understand what's going on and how the system works, and the rest of them go by the book, and often haven't even read the book themselves, just what they've been told.

So... as a realistic consumer you do have to know about the systems you're using if you don't want to get surprised. Money's one of those things that justifies learning about in direct proportion to how much you have, I suppose. If you're making a giant deposit, you should probably at least know the mechanics of what's going to happen to it after you turn it over to the bank. Again, in a perfect world, the teller you talk to would know what happens to it and if any of what's going to happen is relevant, they'd tell you. In actuality, they know to type the amount in their computer, verify the account matches, and put it in a drawer to be collected by someone else later.

I'm old now - or I feel old, which is the same thing - and it seems to me that the knowledge of the people you interact with at stores and banks and everywhere is vastly eroded. There was a day when the people at the store were directly responsible for all communication and education of the customer - if you had a major complaint about your bank, you'd go in to the bank and complain, and it would get solved by someone there, if not your teller, then at least in his presence so next time the problem came up, he'd understand it. He'd learn pretty quick about how everything worked 'cause he had to.

Today, you have a major problem with your bank and unless you just happen to be at a branch at the time, you'll make a phone call. To some guys possibly halfway across the country, who only know how to solve your problem by reading from a script... If you DID happen to go to your bank, none of them would even know that script and would (eventually) refer you to call the bank instead of asking them.

What was I saying? Get off my lawn, damn kids! Makin the dog bark again...

Go for the real thing

[Stratoukos]

Haha, what a tool. Everyone knows that only Nigerian citizens are the real deal.

Re:Go for the real thing

[Ecuador]

Nope, Nigerians are worse. Unless we are talking about Nigerian royalty of course!

Re:Go for the real thing

[Scarumanga]

Anyone who falls for these scams is a retard pure and simple.

15 Percent?

[dark grep]

The man is obviously an idiot not to realize that anyone who would increase the commission to 15% could be negotiated up to 17%.

Re:How is this a Nigerian scam...

[Nemyst]

At this point "Nigerian scam" refers to the technique and proceedings more than the origin.

Re:How is this a Nigerian scam...

[knacjesus]

because it's the TYPE of scam ... aka 419 ... it doesn't have to be from nigeria ... it's just a variation ...

The latest version of this scam

[SilverJets]

I received an e-mail of the latest version of this scam a couple of months ago. This time it was a US Marine trying to get money out of Iraq. After laughing at the idiocy of this I was joking with some friends that "Yeah, I bet the US government would like to get money out of Iraq too. Maybe this Marine should contact them." :P

Re:The latest version of this scam

[Pence128]

Money? No, no, no, it's oil they're trying to get out of Iraq.

bank responsibility

[Skapare]

For the most part of this, it is Charles Peters that is stupid. However, we really do need a system in which we can find out if a check REALLY does clear FINALLY and ONCE AND FOR ALL. It won't be easy to do, because if the account holder the check is drawn on is innocent, and only finds out a month later, they certainly must have a right to void the transfer. So this would have to be some specific number of days after which the check is absolutely as clear as cash. Maybe 100 days?

the bank told him his deposits cleared

[contrapunctus]

i think the problem is that the bank told him the deposits cleared, then they took it back saying the checks were altered.

Re:the bank told him his deposits cleared

[Totenglocke]

The banks were altering the deal - pray they don't alter it any further!

Re:the bank told him his deposits cleared

[darkonc]

I think that it might be worthwhile to go after the foreign banks (attach them as third parties to the suit) that first accepted and then rejected the cheques. I'm guessing that they knew what was happening and were, in some way or another, party to the process.
I would among other things, ask for the original cheques back and proof that the modifications that they claimed had been done -- and done improperly. It seems rather likely to me that the banks involved in this transaction know what's going on, and it's time for them to be taken to task.

One thing to note about this action is that it does not make a final determination. It's simply a case of the bank attaching to the property in case it wins the actual suit -- just to prevent Peters from getting rid of the property before the actual lawsuit finishes. There is a lot of fighting that could go on in the case, (e.g. the SCO litigation) and it's not absolutely clear that the bank will be the clear victor in the end (even the judge in the case raises some questions).

Not considered fraud until later..

[nanospook]

Why didn't the bank validate the checks before they wired the money? They later determined they were frauds.. couldn't they have determined that earlier or should they have had a process in place to delay the transfer until totally verified? Thats a large amount to send out of the country to Malaysia.. Just asking the questions.. I don't think I picked up on it when RTFA..

Re:The bank should pay.....

[arbiter1]

i do feel a hair sorry for him, but he was dumb enough to fall for this. Kinda surprised they extended that credit for that amount of cash if he doesn't least have that much in his account. Being such a large amount they should seen this could be some type of scam and put a hold on the checks til they clear. If they are from another country that should tipped the bank off something might be fishy since it can take a while for the check to clear fully. As i typed this it has made me thing that yea he should bare some of the burdon but bank should have to take some the blow since it didn't set off a red flag when someone deposit 800grand in checks.

Re:How is this a Nigerian scam...

[ericvids]

But the 419 scam *specifically* originates from Nigeria. After all it was named after the article number of the Nigerian criminal code.

The type of scam really is "Advance fee fraud" http://en.wikipedia.org/wiki/Advance-fee_fraud. The Nigerian scam is only a subtype of this.

Besides, the court decision in question http://www.rhlaw.com/blog/californialitigationattorney/wp-content/uploads/2010/12/E049170A.doc specifically said "Nigeria-style email scam" instead of "Nigerian scam". Similarly, one cannot say this is a 419 scam, just a 419-type scam.

Anyway, the point is that this is poor reporting. The court decision exerted due diligence to be accurate in its wording; why not the blog article?

Re:How is this a Nigerian scam...

[Skapare]

Actually, it is the reverse. The foreigner is seeking the victim to be a money collector, instead of a money distributor. E.g. the money comes FROM someone else and is sent TO the person doing the email exchange.

Money lots of money being a debt collector!

[Skapare]

Earn 15% commissions when you collect on our debt accounts. We send you the accounts and contact info. You do the collection calls. Payments are sent directly to you. You take 15% out and send the remainder to us and we send you more accounts. OK, that's the pitch. The sting should be obvious to slashdotters at this point. The lure would be a few small accounts that are easy to collect on and the victim actually gets the 15%. They get an email saying "wow, I'm impressed ... we'll be sending you some better accounts". You know what that means.

What question works?

[stonefoz]

Asking the bank if the check cleared yields an answer which doesn't mean shit. If none of that means anything, what question must one ask the bank to require them to not reverse the answer? Is there a point where they can't do what ever the fuck they want to do?

Re:What question works?

[rudy_wayne]

Asking the bank if the check cleared yields an answer which doesn't mean shit. If none of that means anything, what question must one ask the bank to require them to not reverse the answer?

That's the real issue here. Yes, the guy is an idiot for falling for an obvious scam. But this whole check clearing process is bullshit. A check is either good or it isn't. It either clears or it doesn't. There should be no in-between. There should be none of this bullshit of "well ... it has provisionally cleared ... sort of .... maybe ..... we don't really know and even if we did know we won't tell you for a month or two".

It shouldn't take months. Or weeks. It shouldn't take more than a couple of days.

The bank sends the check off to the ACH who in turn electronically contacts the bank where the check is drawn..
"Hello. We have a check number ____ Account Number _____ In the amount of ______ Is this check OK?"

And within a reasonable amount of time, they have to tell you "yes it is good" or "no it's not any good" And that's the final answer. Period. If someone didn't do their homework, tough shit.

Re:What question works?

[Khashishi]

Simply put, banks own the world. If you screw up, you lose. If banks screw up, you lose.

Re:What question works?

[Fallen Kell]

Only problem with this is that the account holder never has a chance to see/verify that a check he wrote wasn't altered after the fact somehow (i.e. scanned, reprinted, photoshopped, whatever) before it actually was deposited somewhere.

Now I agree that I feel the bank is the one that screwed up here. If you are told a check has cleared, then it is cleared. At that point, you have been told legally that the money is now yours and in your account free to do with as you please. At that moment, if something comes up which causes the transaction to be voided, it should be on the bank to then void any following transactions if there was subsequent activity as it was the bank that gave them the "all clear" to use the money by saying the check had cleared in the first place.

Re:What question works?

[Rogerborg]

In a previous life I worked in a bank, and our answer was always the form "If that check were in our hands today and in good order then it would be honoured".

If you want to hear that as a "Yes, that piece of paper you've just described to me but which I haven't seen yet is definitely good, so go ahead and bet the farm on it" then that's your problem.

Re:What question works?

[zippthorne]

A related issue, IMO, is that the bottom of every cheque is printed with an immutable account and routing number, and these two numbers are sufficient to perform deposits or withdrawals on your account in any amount.

Including *more* than you have in your account, if you fell for the bank's own "overdraft protection" scam.

Re:What question works?

[index0]

Do you really believe banks can recognize "funny" money but can not see that a check is fake? Most checks I have seen have security features like money.

Re:What question works?

[osgeek]

And if the check was forged from an innocent's account?

Re:What question works?

[Elros]

I've been told that asking if the funds have been "finally delivered" is the correct phrase. I would suppose that (if you care to go through the hassle) a conversation with the bank about avoiding that risk might be in order.

Fooled Twice

[makubesu]

Scammed not just by the email but by the bank too! They should work together.

Dear Slashdotters

[gearloos]

Dear Slashdotters, I am writing here in hopes that someone could help me with a problem. I assure you that you will be well paid for your efforts. I am a Martian Prince and have been exiled from my home planet. My planet and this one have been unwilling to allow me to transfer funds from zxabhins to US dollars. If you would be so kind as to help me transfer monies I would gladly give you 15% for your efforts... lol *Note for the sick society we live in: This is a JOKE. Get over it. I can see some jackass politician signing his latest DRM order and then getting on his computer and reading this and saying "get him".

Re:Dear Slashdotters

[WrongSizeGlass]

Dear Slashdotters, I am writing here in hopes that someone could help me with a problem. I assure you that you will be well paid for your efforts. I am a Martian Prince and have been exiled from my home planet. My planet and this one have been unwilling to allow me to transfer funds from zxabhins to US dollars ...

Ah-HA! You're not a Martian Prince! Any true Martian Prince would have enough of an education to know that Martians always capitalize any and all H's in proper nouns. Once again bad grammar exposes another scam artist.

Re:Dear Slashdotters

[gearloos]

Ah-HA! You're not a Martian Prince! Any true Martian Prince would have enough of an education to know that Martians always capitalize any and all H's in proper nouns. Once again bad grammar exposes another scam artist.

Unfortunately, the above is an assessment based on Planet Earth, United States, English. Martian Grammar call for the "Home Planet" to be lower case, as well as any reference to it. This was designed to prevent the citizens from developing ego.

text taken from the Turner Diaries

[garyisabusyguy]

Author: William Pierce (as Andrew Macdonald), leader of the neo-Nazi National Alliance
Published: 1978

http://www.adl.org/learn/ext_us/Turner_Diaries.asp?xpicked=5&item=22

you can find it posted in stormfront too, total drek

Wow

[krazytekn0]

He actually had about $800K in the bank from the scammers in checks that cleared before he sent $458k back to them, Then the fraud was discovered by the bank and they attached his assets... oops

Re:LINK GOES TO SPYWARE!

[Opportunist]

Thanks, but our killer already finds that one.

But it's one of the reasons I read /. and other boards, they're a great source for samples.

Re:How is this a Nigerian scam...

[antifoidulus]

To quote Futurama, "you are technically correct, the best kind of correct". Yes this is called an "advance fee fraud", but that isn't how most people refer to this kind of thing. You are interpreting language to be much more prescriptive than it actually is. Language is simply a tool for humans to communicate, not some sacrosanct set of rules that cannot and should not be changed. Most people know this kind of fraud from the Nigerian emails and thus thats how they refer to it.

It's just like "kleenex". Yes, it's technically called tissue paper, but thats now how a lot of people refer to it. If your grandmother asks you to hand her a kleenex and all you have is scott's brand tissue paper are you really going to say, "Sorry grannie, I don't have any kleenex."?

Re:How is this a Nigerian scam...

[ericvids]

In legal circles, the language HAS to be technically correct. Otherwise you risk all sorts of things, from frivolous lawsuits to straining diplomatic ties.

This "Nigerian scam" identification comes from a law blog. That's why it's bothersome.

It's the equivalent of requesting your supermarket to stock up Scott's brand tissue (maybe it's cheaper) and they stock up on Kleenex instead, and the supermarket just shrugs it off saying "it's the same thing."

Check clearing is a centralized process.

[crovira]

The bank DOESN'T sit on checks. They send the imprint (300dpi scan) and the information transcribed into a fixed format record to the check clearing house (its a branch [usually Chicago] of the Federal reserve who make billions of dollars off of the "float" so they DON'T ever let it linger.)

Banks make YOU wait x business days because they can.

The check has usually cleared within a single business day.

Re:The bank should pay.....

[haruchai]

In many cases, I would side with the victim over the bank but for an Internet e-mail scam? What rock has he been hiding under for the last 15 years?
The 1st thing you should ask is, why me? If this was legit, why wouldn't the person be looking for a reputable professional? For 12% of that kind of money, any number of qualified pros would do the job.

But, I take your point about the large deposit. I doubt my bank would operate like that and I believe that banks here bear the responsibility of fraudulent transactions and cannot penalize the client unless it can be shown that person acted in bad faith.

Sounds logical to me

[Anonymous Coward]

Anyone in the accountancy/banking business would have a whole career of experience telling them that it is both common and ethical to get free money.

Seems like they'd obviously be the ones to fall for it. To the rest of us, the promise of free money sends up a huge red flag, but to them its just a part of normal everyday business.

Re:Sounds logical to me

[oobayly]

This has to be the most sound reasoning I have seen regarding 419 scams that I have seen. Why post AC?

Re:Sounds logical to me

[Carewolf]

Or maybe some people in accountancy actually gets emails asking them to help transfer money as a usual part of their of job - so it doesn't seem like an email send to a random person.

Re:Sounds logical to me

[Waccoon]

While working in a retail store, I once scanned through some promotional material for new machinery. One of the products was named, "The Profitmaker."

I supposed if you're bombarded all day by BS that shameless, you tend to tune out the warning flags after a while. Not that it makes any more sense, of course.

Re:How is this a Nigerian scam...

[fishexe]

... when the article clearly says it was a Malaysian doing the fraud, and the funds are transferred to a Hong Kong bank?

It's not even close to Africa.

News flash! Not all ponzi schemes are actually conducted by Charles Ponzi either, and some games of Russian Roulette are played by non-Russians outside of Russia...

Re:How is this a Nigerian scam...

[fishexe]

This "Nigerian scam" identification comes from a law blog. That's why it's bothersome.

Would you be this bothered if a law blog said a theory "had as many holes as Swiss cheese" but they were picturing Cheese made in America?? Seriously, at this point "Nigerian scam" is a name for a type of scam, not a place of origin, just as surely as "Swiss cheese" is no longer (in the US) a name for Cheese from Switzerland, but rather for a type of cheese.

Re:what if he had withdrawn the $808k first ?

[Fujisawa Sensei]

would the bank have still been able to come after him for it or would this have been the tip off that it hadn't "really" cleared ?

Yes, they would have come after him. And they would have hit him with other fees and penalties as well.

Bad lawyering on both sides

[mbstone]

According to the California Court of Appeal opinion, neither the lawyer for the scam "victim" nor the lawyer for the bank identified the correct legal issue (apportionment of fault per the Uniform Commercial Code). And neither the lawyers nor the Court of Appeal picked up on the federal Check 21 law issue (the law that says banks are required to give credit against fake cashier's checks within one day after deposit).

The plaintiff's lawyer, because he didn't spot the UCC issue, almost certainly failed to discover or put on evidence that the bank was negligent in crediting the fake check.

Re:Bad lawyering on both sides

[mbstone]

Oops. It's not Check 21 but Federal Reserve Regulation CC that requires banks to credit the full amount of a deposited cashier’s check within one business day (12 CFR 229.10(c)(v)).

Re:How is this a Nigerian scam...

[ericvids]

Would you tell someone that s/he's an "Indian giver" if a Native American is within earshot?

Re:How is this a Nigerian scam...

[1u3hr]

Most people know this kind of fraud from the Nigerian emails and thus thats how they refer to it. It's just like "kleenex"

Well, no, it's not like "Kleenex", because we're talking about human beings. Nigeria is a country with a population of 150 million people, and to label them all as thieves, or use their country's name as label meaning "thief" is pretty unpleasant, and basically racist. Consider how "jew" or "gypsy" was (and in some places still is) used as pejorative. And no matter how many Nigerian fraudsters there are, they're still a tiny percentage of the country; and also tiny percentage of fraudsters in the world.

Question

[dcollins]

FTA: "Peters deposited the $808,988.90 in checks received from the purported Malaysian at the Chino Commercial Bank. After the bank notified Peters that the checks had cleared, Peters wire transferred $468,000 to Hong Kong. Shortly thereafter, the checks were dishonored after the bank detected that they had been altered. Since Peters was personally liable for any overdrafts on the account which had only a few thousand dollars, the bank sought to attach property owned by Peters to collect on the overdraft. The trial court granted the bank’s motion to attach against Peters in the amount of $458,782.60...

Despite the obvious life lessons, the legal one is this – don’t transfer funds received unless and until you know that collection of the original deposit is final. This is particularly true for lawyers and others who receive funds in trust. (Chino Commercial Bank v. Peters, Dec. 13, 2010, Case No. E049170.)"

So my question is this -- HOW do you know that collection of the original deposit is final? (I've never even heard that phrase before.) Apparently being told "the check has cleared" doesn't do it?

Re:Question

[mochan_s]

I don't think there is a way to tell from the depositing bank.

Some people say wait a month but banks say it can take up to 2-3 months for checks to clear.

The other way is to ask the bank that issues the check or money order to check if it has cleared. Obviously, this is a big problem if the issuer is outside the US.

And that is why this scam is popular. Once people put the check in the bank and the balance shows up, people think everything is legit and send money out of that balance.

Re:Question

[NotQuiteReal]

HOW do you know that collection of the original deposit is final?

When the bank will allow you to withdraw the money out of your account, in cash, while mentioning you need "spending money" because you are leaving on an extended trip* to [insert name of country without extradition].

* Where "extended" >= statute of limitations for bank fraud...

Re:Question

[gnasher719]

So my question is this -- HOW do you know that collection of the original deposit is final? (I've never even heard that phrase before.) Apparently being told "the check has cleared" doesn't do it?

What about this: You ask the bank "is this final or is there any way that you can ask for the money back?", and then you ask them to give this to you in writing. You might then check out the laws of your country to find how far a written statement of a bank employee is legally binding for the bank to be absolutely safe, but having it in writing that they cannot ask for the money back would go a long way to help you in a court case.

In the end, the person sending the cheque can probably for a very, very long time sue you in court for whatever reason to ask for the money back. For example, if someone stole a cheque from me, used it to put $500,000 into your account, and I noticed this only half a year later, don't you think I would take you to court? (Although I think there would be problems with this in the USA, because in US law it would only be accepted that you have _my_ money if you had real banknotes that were taken away from me. With cheques, the money going out of my account is not legally the same money that is going into your account).

Re:Question

[SleazyRidr]

This just came to me: if they can call back the cheque, can he then turn around and call back the wire transfer?

Re:Question

[aClodHopper]

Why is the retrieval process from the bank stopping at Peters? Should not the receiving bank also revoke the transfer and collect from the final recipient, thus reversing the entire process.

Re:Question

[dcollins]

So when this guy's (or anybody's) bank told him "the check has cleared" that's a meaningless statement?

Re:How is this a Nigerian scam...

[fishexe]

Would you tell someone that s/he's an "Indian giver" if a Native American is within earshot?

I wouldn't use that term under any circumstances. It's both derogatory and based on false beliefs (the belief, once common in the US, that American Indians traded away their land fair and square and then wanted it back, when in reality it was the Europeans who went back on their word in the overwhelming majority of agreements between the two groups). Neither "Nigerian scam" nor "Swiss cheese" are derogatory terms, nor are they based on false assumptions. I would use the phrase "Nigerian scam" within earshot of a Nigerian, and would say "Swiss cheese" within earshot of a Swissman, without hesitation, if the appropriate circumstances arose.

Bank should lose

[Anonymous Coward]

The bank should eat it. I mean, come on - at what point can you rely on the deposit clearing with finality?

Someone here said that this is how it has to be because how does the bank know that the Malaysian and the victim didn't conspire together? Well, how does the victim know that the Malaysian and the bank didn't conspire together?!?

Re:Bank should lose

[TFAFalcon]

Or at least allow the victim to reverse the transfer they made. Let the Malaysian bank collect from the scammer.

But you didn't get the super definite clear...

[superdave80]

After the bank notified Peters that the checks had cleared, Peters wire transferred $468,000 to Hong Kong.

Shortly thereafter, the checks were dishonored after the bank detected that they had been altered.

So what the hell does clearing a check mean? I always assumed that this means that the bank verified that the check was good and they received the funds from the other bank. How much later can a bank claim that a check is no good after it has cleared it?

Re:But you didn't get the super definite clear...

[lambisgoia]

It means nothing. Even cashier's checks can be dishonored this way!

Re:But you didn't get the super definite clear...

[Solandri]

So what the hell does clearing a check mean? I always assumed that this means that the bank verified that the check was good and they received the funds from the other bank. How much later can a bank claim that a check is no good after it has cleared it?

That's what it used to mean. But (1) some people got upset over having to wait for how long it took to verify certain checks, and (2) many banks were abusing it to hold the customer's money for a few extra days and make interest off of it. As a result, laws were passed which mandated the banks credit your account for a deposit within a certain amount of time (usually a day). Unfortunately, those laws make this type of scam possible for those who mistakenly think that when a check clears, that means the money is yours.

Ideally, the money should become available the instant the bank verifies that the check is legit, at which point it should become the bank's problem if it turns out not to be legit. In this type of fraud, the bank should be acting as a collective insurance service for its depositers. When a bank gets robbed, the bank doesn't say "I'm sorry Mr. Smith, I'm afraid the robber took off with $60k in bills, including all $36,427 in your account." Instead, they eat the initial hit and redistribute the losses to their customers in the form of service fees, spreading out the losses in the same way as insurance.

Con artists

[Anonymous Coward]

There are a lot of con artists out there. They come in all shapes and sizes.

I was the victim of one that managed to get $150,000 out of me over the course of 2 years. They can be very smart and work their way into your trust as a friend. This one was introduced by someone I knew and didn't start asking for money for a few months, but when he did start talking about investments, I fell into his traps and signed some investment contracts that I wish I had not. The advice that I give out now, and wish someone had given me, is that as soon as you start feeling that something is not right, go talk to a lawyer!. Pride and embarrassment do nothing but help them to let you dig yourself in even deeper. I had been convinced that I was simply bad at business, and the agreements I had made needed to be stuck to. When I finally did talk to a lawyer, it took them about 10 minutes to explain that I was experiencing a classic fraud case. Because the con artist was so good at what he did, he covered his trail very well. I was told both by the lawyer and the police that it would probably cost me more than I lost to try to get it back.

Life is a game of constant learning. I now look at this as an expensive life lesson. Unfortunately I have come out of the experience much less trusting, especially of people talking about money.

Just please remember, that you are most likely not the only one they have hit. Go talk to a lawyer!

Cheers,

You guys are all missing the point.

[northernfrights]

The scammer successfully made off with $460,000 that never existed. This is no "I need $200 from you to cover the transferal fees" scam. This is some crazy shit.

Re:You guys are all missing the point.

[Peeteriz]

Yeah, the man could've just forged the checks himself, submitted to his bank, wired it out to Malaysia and went for an early tropical retirement sipping margaritas..

Re:You guys are all missing the point.

[Anonymous Coward]

Oh, dear, those $460,000 exist. They will deduced from the victim. Do you really think the bank is gonna lose? Never. The victim will have to pay, and in case he declares insolvent, there is a deposit to cover frauds. So that money exists.

Re:You guys are all missing the point.

[yurtinus]

Bad mods... The $460,000 absolutely did exist. The money came from the bank's balances (since one of their member accounts is now 460k in the red), and now they are going to recover that balance by taking the sucker's house. It's not crazy, it's not insightful. If the money never existed, why would anybody bother with recovering it?

Re:How is this a Nigerian scam...

[antifoidulus]

Just ascribing a nationality to something doesn't even remotely infer that everyone in said nation is involved with such activity. Do all French "french kiss"? Doubtful. Are all Swiss involved in making cheese, or even eating what we call "Swiss cheese"? Nope, but we still call it that. Are all Japanese infected with "Japanese Encephallitis"? Nope, in fact the disease has almost been eradicated from the country. Spanish flu? Wasn't even from Spain. etc. We call it the nigerian scam because it was Nigerians who first popularized it. Thats all, nothing more, nothing less. It does not suggest that all people from Nigeria are scammers. If you don't like it then you are going to have popularize a new term, but good luck with that.

There are only two possible conditions...

[Genda]

Either the person has a legitimate condition limiting mental or emotional function, and as such needs to be protected from themselves (i.e. Dementia, Psychosis, Alzheimer, etc.)

OR

Someone has just paid their idiot tax. Being, promoting, empowering, electing, and/or justifying stupid is expensive, and our society is continually finding new and more interesting ways of paying that tax every day.

Re:Here, its hard for the bank to protect itself..

[91degrees]

I think it's more that the banks need at least some mechanism to reduce the risk here. I don't know how it should work, but if they were held even partially liable, the banks would work it out pretty damn quickly.

The banks do have a system which allows this fraud to go ahead easily and they know it. They have made absolutely no effort to reduce the risk for their customers. Basically, the banks are negligently allowing this fraud to continue. If you are in a position to prevent a crime, and that crime continually occurs with you as a vital part, I believe that you are negligent and bear some responsibility.

Re:LINK GOES TO SPYWARE!

[Nyder]

?

NAV doesn't see a problem with it

Ya, Norton Anti Virus is a quality virus finding program. Sort of like Mcafee is a quality virus finding program.

What I mean is, if you run those, virus will find your computers to be a good place to breed.

So, next step Honk-Kong, no?

[UglyMike]

With all this hunting-for-al-qaida's-money going on, why is it not simply a question of going to the HongKong account and find out who witdrew the money? Surely the bank there can't say "Oh, we have no idea, we hand out half a million dollars cash to anyone without verification of their identity?" I mean, bank secrecy is dead no? ...and if the bank doesn't want to play ball, how come the whole finanial community doen't stomp it 6 foor under ground for aiding and abetting financial crimes?? ...or is it only a serious crime when it hits rich people or goverments and f*ck the little guy?

Re:How is this a Nigerian scam...

[FuckingNickName]

So it's OK to call someone a money-grubbing Jew because Jews, not bound by Christian tradition, traditionally fronted for wealthy landowners? Never mind that usury / advanced fee fraud has occurred well before and more often outside Jewry / Nigeria than within, Jews popularised usury so we need to associate them with it.

Re:LINK GOES TO SPYWARE!

[Neil Boekend]

The only thing that indicates is your ignorance and/or stupidity. I have no means to find out whether Norton detects a virus. I wouldn't bet on it.
The only thing Norton does efficiently is slow down your system. So if you would like to run old (mid 1990's) badly written games that speed up with the processor, you should try it. Otherwise: use MSSE or a free scanner (AntiVir was my drug of choice until MSSE came). They have far less overhead and far better detection chances. With antivirus software you get the reverse of what you pay for: the payed versions are useless while the free versions have some diamonds in them.

Re:LINK GOES TO SPYWARE!

[TaoPhoenix]

Is it really spyware/malformed PDF?
I was bored so I looked at it, but MS Sec Essentials didn't flag it.

Re:How is this a Nigerian scam...

[1u3hr]

Do all French "french kiss"? Doubtful. Are all Swiss involved in making cheese, or even eating what we call "Swiss cheese"? Nope, but we still call it that. Are all Japanese infected with "Japanese Encephallitis"?

None of those terms ascribe a criminal or immoral act to people of a specific nationality.

It does not suggest that all people from Nigeria are scammers.

Yes, it does.

If you don't like it then you are going to have popularize a new term, but good luck with that.

Well, sure, Nigerians don't have enough clout in the USA to stop you insulting them, as would be the case if it was "Jewish scammer", "Mexican scammer" or some other ethnic group more established in the US, so you can feel free to piss on them.

Of course there are already several established terms for this kind of fraud, the Nigerians didn't invent it after all. "Advance-fee fraud" is the most generic and descriptive. "419 scam" retains the Nigerian flavour if you like, referring to their legislation.

And aside from the whiff of racism, it's just misleading if, as in this case, none of those involved are Nigerian, and Nigeria is never mentioned in the story, except for the label.

Re:How is this a Nigerian scam...

[antifoidulus]

Wow, you cannot even get your nouns right. The noun in "Mexican scam" is scam that somehow or other has a relationship to Mexico, not a person. In "Mexican scammer" the noun is a scammer who is Mexican, which is much more derogatory than the former. So yeah, until you can get the very basic building blocks of language correct there really is no point in arguing with you.

Re:sic?

[lxs]

"outside America continent" is an odd turn of phrase. I guess it indicates faulty grammar.

Re:How is this a Nigerian scam...

[meiao]

I believe that any person in the world, who's not a Nigerian, is forbidden of commiting such a crime.

Another question...

[Ecuador]

Why did he transfer $468k? The $809k-15% is $687. Was he trying to stiff the Malaysian, or did only part of the check sum posted on his account (which should have alerted him)?

PS. I want a point for using checksum in non computer post ;)

The scam spam makes good humor reading..

[Nichole_knc]

Got to love the humor of all those scam spam. "The Nigerian government owes you $11M for your contact service" Funny can't seem to remember that job? How stupid of me to forget a 11 million dollar job....

Bank should have...

[kurtis25]

Banks have a vested interested in seeing activity like this; transactions keep money flowing, branches get bonuses / awards based on volume (the check he wrote counts), bank fees. They also know that cleared doesn't mean cleared all the way I think there is a time limit on clearing the checks that each bank has but keep in mind this transaction likely went through 3-4 banks before hitting the Chino Commercial bank which means it could be (and should have been) stopped anywhere along that route. This guy's actions should have triggered fraud warnings at his bank, for several reasons 1) depositing a large sum from a foreign bank 2) a deposit outside his standard profile (I would assume he isn't depositing a large number of high dollar amount checks or a large number of checks in 1 transactions) 3) Writing a check which is outside his standard profile (again I'm assuming he doesn't write to many high value checks). If he'd used a credit card he would have received this level of service. As small business owner I do a great deal of banking. I have 15 banks accounts I deal with (including personal) at 3 banks. I know my bankers and they know to notify me of any out of the ordinary activity on any of my accounts. Every customer should get to know their bankers so it's a personal connection not $ in and $ out.

what kind of dr is most likely to be addicted?

[circletimessquare]

answer: anaesthesiologists

as with your accountants, these are the guys who have the most education about psychopharmacology and the biochemistry of addition

which tells us something about human nature: education is really not that much of a protection against base human weaknesses

Re:what kind of dr is most likely to be addicted?

[stonewallred]

Actually they have less education about addiction because they don't prescribe drugs, other than the ones they are administering and/or supervising the use of in surgery. They tend to become addicted because they have really good dope available, very little over-sight by hospital drug counts and accounting and they get freebies, aka samples, from the friendly pharma pushers. I had a friend whose mom was a nurse anthologist. When we were in our teens, we used to go into her bedroom and pick a handful of dope out of the big bowl she kept, and then study up on what we had and the proper dosages to get fucked up, without dying.

Nigerian EMail Scam

[NoDos]

You'd think that after all these years of the well known Nigerian scams, The Ghana scams and every other scam coming out of Africa, that people would wise up and realize that they're nothing but SCAMS!!! I get e-mails like that on occasion and everyone of them gets Trashed, without even being read! There's no such thing as Free money, folks, so wake up and smell the coffee!!

Greek banks

[wired.alex]

In Greece banks won't cash foreign checks before actually clearing them. I once had to cash-in a US check and it took around 20 days for the money to show up in my bank account. Semi-clearing the cash earlier, only to take em back later on, while allowing a half-a-million wire transfer, sounds like a scam to me. No excuses for that guy though.

Re:LINK GOES TO SPYWARE!

[insufflate10mg]

There's no virus; the vulnerability that would likely be exploited for such a virus has been fixed for the most part anyway. The file is simply a book by Andrew Macdonald, called the "Turner Diaries" -- extremist right-wing propaganda about the white supremacist and militia movements taking over the US and leading to nuclear war within the US, destroying much of it. The book is set up by finding the diaries of a leader named Earl Turner 100 years after the war.

Doctor Nick!

[toby]

n/t

Re:Non-extradition anyone?

[JSBiff]

If I just took the money and run, I'd be less worried about extradition than about execution. People who break the law probably wouldn't hesitate to track you down wherever you went, kill you, and take the money. Or kidnap one of your relatives and demand a ransom.

Re:Reverse Nigerian Scam

[TheRaven64]

Sounds like he didn't realise it's a scam - and if someone's just sent you a significant fraction of a million dollars via a mechanism where you don't realise that they can reclaim it, that seems almost sensible. I just wonder if you can do a variant of this by getting someone to send you a cheque for $1m, pay it in, wire them the $1m, then leave the country and split the money, then contest the cheque.

Sounds like the way to beat both

[Philomage]

... the bank and the scam is to deposit the cheque in a daily interest savings account, wait for it to clear then hold off the scammer for six weeks or so to make sure it really clears (telling him "I'm still waiting for it to clear").

Then if the cheque does ultimately bounce, you still have the money to be rescinded, and if you're lucky you get the interest. The scammer gets nothing if the cheque doesn't fully clear (of course, then he's not a scammer, is he?).

Re:Sounds like the way to beat both

[Philomage]

Probably; that's why I said "if you're lucky". But the banks never lose when it's between us and them.

Re:How is this a Nigerian scam...

[lwsimon]

I've always taken the term to mean entering into an obligation without a full understanding of what you're agreeing to.

You can't con an honest man

[istartedi]

I recall a story several years ago when one of the biggest group of people suckered by these scams were accountants and people in similar financial professions

There's an old saying, "you can't con an honest man". Of course you can con an honest man; but it's harder. If somebody is greedy and prone to cheat, they're a lot easier to con. A lot of cons rely on the victim believing that they're part of something criminal. Once they step over that line, they feel like they have to keep going, and they won't go to the police because they're "in on it".

Re:How is this a Nigerian scam...

[ericvids]

It's both derogatory and based on false beliefs

So, then, who are you to judge that it is not derogatory to Nigerians to call any confidence tricks of that type as a "Nigerian" scam? It is precisely the assumption that "no one is being offended" which led to widespread careless use of the term "Indian giver".

Also, as in your argument, calling this a "Nigerian scam" was already based on a false belief in THIS context -- i.e., it was really a Malaysian that was involved, not a Nigerian. Just as the Europeans were the ones who went back on their words instead of the American Indians.

Re:The bank should pay.....

[makomk]

Errm... you do realize the US actually had a widespread program of forced sterilization of women without their knowledge and consent right up until the late 60s, with the last legal forced sterilization in 1981? I've never understood why so many people are willing to joke about eugenics...

Re:The bank should pay.....

[haruchai]

Yes, I was aware of that and many other bad things that the US and other countries have done. Were you aware of the Tuskegee airmen? So much for jokes about soldiers and STDs.

If we stopped making jokes because of bad things that have been done, that would be the end of humour.

Re:How is this a Nigerian scam...

[HBI]

In my childhood (think 35 years ago) I heard all these terms:

"Jewing someone down" - negotiating a price down
"Jewish lightning" - setting a building on fire to collect the insurance money
"Don't be a Jew" - a reaction to being unwilling to lend, negotiating too hard or being cheap

They are less frequent today, but still are heard occasionally. Just yesterday, I had a flashback of people being called Jews for picking up pennies from the ground and left one I had dropped on the floor of a shopping mall.

My point is, whether it's ok or not, it still happens. I probably didn't have to explain at least two of the terms above, i'm sure you have heard them before.

Re:You're kidding, right?

[Sigma 7]

You mean this one?

Also, any form of malware on a "secure" operating system is just as damaging as one on an insecure one. While your system may be recoverable, your 1TB of beautiful artwork will be waxed because you generally store that as something that can be deleted by regular user privileges.

Re:How is this a Nigerian scam...

[publiclurker]

The phrase originally came about because Native American tribes and European settlers had different ideas regarding trade vs. gifts. Nowadays, around here at least, most people consider the phrase Indian giver to be referring to how the white man and their government would take back anything that they agreed to with the Native American tribes if it was to their advantage to do so. A good example of this would be the Black Hills region of North Dakota.

Re:How is this a Nigerian scam...

[tsstahl]

Citation?

I was taught that the phrase 'indian giver' referred to whitey breaking agreements with Indians, not the other way around.

Heck, look at the equity of the bargaining positions: Pick one, Genocide, or subsistence living on crap we wouldn't even graze goats on. Who knew that all that ground would be perfect to put casinos on?

As a person of mixed American heritage, I often have issues with determining when to self loathe and when to bask in martyrdom.

Re:How is this a Nigerian scam...

[fishexe]

It's both derogatory and based on false beliefs

So, then, who are you to judge that it is not derogatory to Nigerians to call any confidence tricks of that type as a "Nigerian" scam?

Who am I to judge? A human being in possession of the faculty of reason, that's who. Let's see, is the tendency of the term to diminish the value of Nigerians, or to indicate that the type of scam originated in Nigeria? If the former, it's derogatory. If the latter, it's not. This follows directly from the definition of derogatory.

It is precisely the assumption that "no one is being offended" which led to widespread careless use of the term "Indian giver".

No, I'm pretty sure everyone knew Indians would be offended and didn't care. In fact, historical evidence suggests the originators of the phrase intended it to be offensive, and intended to diminish American Indians by using the phrase. In using the term "Nigerian scam" I don't assume no one will be offended. If they're offended, that's their right. It doesn't change the point of using the phrase, which is to reference the origin of that type of scam, not to diminish Nigerians.

Also, as in your argument, calling this a "Nigerian scam" was already based on a false belief in THIS context -- i.e., it was really a Malaysian that was involved, not a Nigerian.

Calling this a Nigerian scam WAS NOT BASED ON THE BELIEF THAT A NIGERIAN WAS INVOLVED in this context. If that's not clear, I don't know how to get through to you people. The people calling this a Nigerian scam ALREADY KNEW this particular case was perpetrated BY MALAYSIANS and were using a FIGURE OF SPEECH that is already well-established. Formation of the term "Nigerian scam" was based on the TRUE BELIEF that widespread use of the scam originated in Nigeria, and use of that term to refer to the same type of scam originating in other countries is already common practice.

Re:How is this a Nigerian scam...

[fishexe]

The phrase originally came about because Native American tribes and European settlers had different ideas regarding trade vs. gifts.

That's putting it very generously to the Europeans. In many cases Europeans produced documents for Natives to sign without communicating their meaning, whose meaning in English(/Dutch/French/whatever) Legalese was that Europeans now owned the land the Natives lived on, without any knowledge on the part of the Natives that that's what they said or intent by them to assign any sort of ownership rights whatsoever. In most cases the Europeans who actually conducted the deals were fully cognizant of this. They then went and resold parts of the land to other Europeans, claiming to have valid title to it. When Natives didn't want to move, the Europeans then claimed the Natives had given them land and wanted to take it back (hence the term "Indian-giver") which claim was, in essence, a total lie, not a misunderstanding.

Again, in many cases, not all. There were undoubtedly some cases of legitimate misunderstanding but to act like the deliberate swindling did not occur would be to whitewash away history.

Nowadays, around here at least, most people consider the phrase Indian giver to be referring to how the white man and their government would take back anything that they agreed to with the Native American tribes if it was to their advantage to do so.

I think that's a fair re-purposing of the term. It's origin, however, was in reference to the supposed practice of Indians taking back gifts.

Like Madoff "victims"

[wfolta]

This reminds me of the Madoff clients who didn't make money ("victims"), who are now going after Madoff clients who did make money ("co-conspirators") in order to get back money -- and perhaps "profits", too. Greed is still evidently good, for those who can afford the lawyers... or at least for the lawyers.

Re:How is this a Nigerian scam...

[fishexe]

Citation?

Here:
The term "Indian gift" was first noted in 1765 by Thomas Hutchinson,[1] and "Indian giver" was first cited in John Russell Bartlett's Dictionary of Americanisms (1860)[2] as "Indian giver. When an Indian gives any thing, he expects to receive an equivalent, or to have his gift returned." Wikipedia, naturally.

I was taught that the phrase 'indian giver' referred to whitey breaking agreements with Indians, not the other way around.

In modern usage, possibly. Originally, no. If people want to re-purpose the term to mean that, I'll be the last person to criticize it, but where I live the term is still used by rednecks (the same people I hear saying "give me back the money you jewed me out of!") to put down Native Americans, so I refuse to use it.

As a person of mixed American heritage, I often have issues with determining when to self loathe and when to bask in martyrdom.

I know what you mean. As a person of majority English and other mixed European heritage, I often vacillate between pride in founding much of modern civilization and guilt in doing so many awful things to so many other peoples. I didn't even do either of those things, but somehow I feel responsible for the acts of my forebears.

Why didn't the US bank do it the same, backwards?

[Kittenman]

I haven't read TFA (heck, this is slashdot after all) but if he transferred the cash to Malaysia, then his bank says "oops - hang on a second, the money coming in didn't" what's stopping his bank from doing the same claw-back that the Malaysian back did?

Partly rhetoric. I guess they didn't think of it. But if they'd done that, no-ones out of pocket.

Re:How is this a Nigerian scam...

[ericvids]

Let's see, is the tendency of the term to diminish the value of Nigerians, or to indicate that the type of scam originated in Nigeria?

Do you honestly think that the term "Indian giver" started with the intent to diminish the value of Native Americans? At THAT TIME the Europeans thought of them just as some race they can conquer. Their propensity to offend them did not stem from a direct WANT to offend but from a default mindset of not treating them as equals -- they uttered the term not as an expletive to the Native Americans, but as a description to fellow Europeans.

In fact, historical evidence suggests the originators of the phrase intended it to be offensive

Proof? There was no such thing as political correctness back then. Unless you can point me to an exact source that specifically says that it was meant to directly offend the race (which I honestly have not found), then "intended it to be offensive" is plain conjecture.

It doesn't change the point of using the phrase, which is to reference the origin of that type of scam

Which was inaccurate to begin with. The Spanish Prisoner scam http://en.wikipedia.org/wiki/Spanish_Prisoner predates it by a century.

And if you are going to argue now that this scam was somehow different, then I refer you to an earlier post in this thread -- pointing out the differences of this particular scam with the original Nigerian scam:

The foreigner is seeking the victim to be a money collector, instead of a money distributor. E.g. the money comes FROM someone else and is sent TO the person doing the email exchange.

If this happened often enough (which it is starting to), should we now call this the Malaysian scam? Good luck dealing with them Malaysians then.

And back to you:

Calling this a Nigerian scam WAS NOT BASED ON THE BELIEF THAT A NIGERIAN WAS INVOLVED in this context.

On the contrary, by the use of inaccurate terms, you are propagating THAT EXACT mistaken belief to others who do not know the difference. Look around this article thread -- some posters didn't even KNOW that Malaysia was a different country and have mistakenly assumed that the scam DID originate from Nigeria. Of course they did not read the slashdot summary, but then if the term "Nigerian scam" was immediately clear to everyone that it did not originate from Nigeria, then they would NOT have posted those erroneous comments in the first place.

And by propagating the mistaken belief to those who do not know the difference, you are essentially being like one of the original utterers of the "Indian giver" phrase--you do not know what you are starting. In the future, people WILL mean it to offend, even as the percentage of these scams become less and less from Nigeria and more from other countries. You could stop that right now by simply saying this is just another "advance fee fraud". If you REALLY want to put a name to it, say "Nigeria-style" (as the official court records for this case say), in deference to the historical notion that it was popular in Nigeria for a while. But don't use a term that is clearly a misnomer -- that alone is proven by a good number of posts in Slashdot that got the mistaken belief, and who knows how much more in less intelligent forums?

Re:How is this a Nigerian scam...

[ericvids]

For some reason I ended up replying in the wrong place, but you can find my reply directly below this one. :)

Re:The bank should pay.....

[haruchai]

Okay, it looks like i have my facts crossed. The Tuskegee Airmen and the Tuskegee syphilis experiments appear to be unrelated. Nevertheless, another serious stain on the American record - willfully withholding treatment from human beings without their knowledge and consent.
But, I reserve the right to make jokes about it and please feel free not to laugh.

Re:How is this a Nigerian scam...

[fishexe]

Let's see, is the tendency of the term to diminish the value of Nigerians, or to indicate that the type of scam originated in Nigeria?

Do you honestly think that the term "Indian giver" started with the intent to diminish the value of Native Americans?

Yes. If Native Americans were seen as equals, they would have to be respected. If they were seen as inferiors, they could be conquered.

At THAT TIME the Europeans thought of them just as some race they can conquer.

Exactly. That was MY point.

Their propensity to offend them did not stem from a direct WANT to offend but from a default mindset of not treating them as equals -- they uttered the term not as an expletive to the Native Americans, but as a description to fellow Europeans.

Descriptions to fellow Europeans of a race they wanted to treat as lesser. Hence the attempt to diminish said race. I never said their primary concern was wanting to offend the Indians. I was only contesting your statement:

It is precisely the assumption that "no one is being offended" which led to widespread careless use of the term "Indian giver".

which is obviously full of shit because people who think they are so superior to another race that they have the right to conquer them don't refrain from using terminology that would offend said race. No `assumption that "no one is being offended"` was ever necessary for the term to become widespread because even if they knew with 100% certainty someone would be offended, they STILL WOULD USE THE TERM because they considered those people who would be offended to be lesser, as you yourself admit.

Also, for the sake of all who care about the English language, get a fucking dictionary and look up the word "expletive" before using it again.

Re:How is this a Nigerian scam...

[fishexe]

In the future, people WILL mean it to offend...

Oh genius oracle of all things past and future, please tell me more of what WILL happen, so that I may build my life around your omniscient predictions.

Re:How is this a Nigerian scam...

[1u3hr]

Wow, you cannot even get your nouns right.

Oh. Of course, it isn't bigoted if you use a modifier instead of a noun. So, if I called you a "pedantic cocksucker", that might be offensive. Whereas calling you a "cocksucking pedant" would clearly not be. Thanks for clarifying that.

Re:How is this a Nigerian scam...

[ericvids]

Yes. If Native Americans were seen as equals, they would have to be respected. If they were seen as inferiors, they could be conquered.

You're attempting to confuse the intent with the side-effect of the intent. "Conquer" is the intent. "Offend" is the side-effect. They did NOT mean to offend (they weren't AWARE that they can offend the Native Americans--there was no record at the time that the term got past their own circles, and there was no notion of political correctness at the time to necessitate restraint). As I said, they weren't saying it as an *expletive* to the Native Americans at the time--they were *surreptitiously* saying it amongst themselves, protected by language barriers--so HOW exactly are they going to offend them with it? (And for your OWN sake, look the word up yourself, if only to appreciate that precision does not preclude multiple usages of the word.)

Exactly. That was MY point.

Was I contesting that it was YOUR point? I was clarifying it and using it to explain my position so you see where I am getting at. Quoting that out of context shows that all you're doing is derailing the conversation. Let's put it back on track and point to the one thing your argument hinges on:

No `assumption that "no one is being offended"` was ever necessary for the term to become widespread

But you yourself have agreed that:

they STILL WOULD USE THE TERM because they considered those people who would be offended to be lesser

which is exactly the situation of "having an assumption that '*no one* is being offended'". (Is the obvious rhetoric lost on you? Okay, sure, I'll use "no one *important* is being offended", but only if you agree to use "Nigerian-type scam" yourself. See, I'm open-minded.)

You have not proven that Nigerians will NOT be offended when being attributed with a type of scam that did NOT originate from their country (as I've already pointed out, the method of this scam is different enough, same as the method of the Spanish Prisoner scam is different from the Nigerian scam), making it *sloppy* and *imprecise* to continue to throw around the term without the proper context. Furthermore it is definitely *inexcusable* to use the potentially politically-laden term in a LAW blog and other law literature (which is what I was pointing out in the first place!)

Oh genius oracle of all things past and future, please tell me more of what WILL happen, so that I may build my life around your omniscient predictions.

And that helps your argument.. how?

I need not say any more, seeing as is that you've descended to using outright scorn when I have been careful not to do so when addressing your points.

Re:How is this a Nigerian scam...

[ericvids]

Well, if you think I'm doing a PKW, it certain failed, hasn't it? :P Got "overrated" right off the bat. (Of course I didn't get "troll" or "flamebait"; it was a legitimate question.)

Honestly speaking, I did NOT actually know people used the term "Nigerian scam" to talk about scams originating elsewhere, or that it is somehow popular. I only read about the "Nigerian scheme" term online. People in my country just call it "panggagancho", from the Spanish "gancho" I guess.

Re:How is this a Nigerian scam...

[jfeldredge]

Advance fee frauds have been around for over 500 years. In the days of Queen Elizabeth the First, this was known as a "Spanish Prisoner Fraud". England and Spain were at war, and some English con men would claim "Lord So-and-so has been imprisoned by the Spanish. If you will pay to bribe his jailers into letting him go, he will richly reward you when he gets back to England." Of course, the "bribe money" would simply go into the con-man's pocket, not to Spain.

Re:How is this a Nigerian scam...

[fishexe]

they STILL WOULD USE THE TERM because they considered those people who would be offended to be lesser

which is exactly the situation "having an assumption that '*no one* is being offended'".

No, it's the OPPOSITE situation from "having an assumption that no one is being offended". You're clearly having some problems with the logic of these sentences so let's break it down a bit. If you say "A decided to do X because C was not Y", and I say "no, I think A would have decided to do X anyway whether C was Y or not", and you said "X(A)->~Y(C) == X(A)", in other words that the two situations were exactly the same, that would be ridiculous. Now substitute "offended" for Y, "American Indians" for C, "white Americans" for A, and "use the phrase 'Indian giver'" for "do X". Hopefully the blatant and fundamental fallacy in your reasoning becomes clear.

You have not proven that Nigerians will NOT be offended when being attributed with a type of scam...

I haven't proven it because it was never my claim. I never said they would not be offended. Them not being offended was never a condition of any of my statements. Therefore I never had a burden of proving they wouldn't be offended. In fact, I pretty plainly stated "If they're offended, that's their right."

I need not say any more, seeing as is that you've descended to using outright scorn when I have been careful not to do so when addressing your points.

You haven't been addressing my points. You've been arguing the entire time against things I've neither said nor even implied, hence the scorn. Given that you've basically been making veiled accusations of racism the whole time since you brought the term "Indian giver" into this by implying the phrase "Nigerian scam" was equivalent, you're probably getting off light in the scorn department.

Re:How is this a Nigerian scam...

[fishexe]

It doesn't change the point of using the phrase, which is to reference the origin of that type of scam

Which was inaccurate to begin with. The Spanish Prisoner scam http://en.wikipedia.org/wiki/Spanish_Prisoner predates it by a century.

Oh my GOD! I can't believe you just said "Spanish Prisoner scam"! I hope no Spaniards were in earshot! No, but seriously, how can you argue this vociferously that the term "Nigerian scam" should be considered a slur when you consider "Spanish Prisoner scam" perfectly ok? And need I point out that most "Spanish Prisoner scams" are just as far-removed from Spain and from involving a Spanish prisoner as this scam was from Nigeria? So...double standardize much?

And if you are going to argue now that this scam was somehow different, then I refer you to an earlier post in this thread -- pointing out the differences of this particular scam with the original Nigerian scam:

The foreigner is seeking the victim to be a money collector, instead of a money distributor. E.g. the money comes FROM someone else and is sent TO the person doing the email exchange.

The person who "pointed out" this "difference" is clearly not very familiar with Nigerian scams. This type of scam (where you're supposed to provide your bank account as a vessel for them to transfer money, or you're supposed to cash a check or receive a wire transfer and then re-wire the money) is probably at least as common coming out of Nigeria as the older Spanish-Prisoner-style scam where they tell you they need money up-front to release more money later. In fact, most of the time when I've heard the phrase "Nigerian scam" it's been in reference to this newer type, which you want to call "Malaysian scam", though I've heard "Nigerian scam" used in reference to the other type as well. These days it's basically legitimate to refer to any scam via e-mail that gets people to believe they will get money if they cooperate as a "Nigerian scam" because believe me, if it can be done via e-mail, Nigerian scammers have done it.

If this happened often enough (which it is starting to), should we now call this the Malaysian scam? Good luck dealing with them Malaysians then.

No, because Nigerians have been doing the EXACT SAME THING for at least 20 years now.

Look around this article thread -- some posters didn't even KNOW that Malaysia was a different country and have mistakenly assumed that the scam DID originate from Nigeria. Of course they did not read the slashdot summary, but then if the term "Nigerian scam" was immediately clear to everyone that it did not originate from Nigeria, then they would NOT have posted those erroneous comments in the first place.

Ignorance the part of people who don't RTFA is nobody's fault but those who don't RTFA.