April 28, 2023 • By Dennis Beaver

Dennis BeaverIf Southern California-based family nurse practitioner Joe Torres had read Fool me Once, by Kelly Richmond Pope, he and I would never have spoken. He also would not have lost thousands of dollars in an “overpayment” scam that began when he was with a patient and his laptop screen froze.

I’ll come back to Joe’s all-too-common story in a moment, but I would like to offer this suggestion if you are thinking about a gift for a high school or university graduate — really anyone who wants to learn how to protect their money.

Let that gift be one of the most useful books they could ever own. Fool me Once provides keys to avoid being taken by the con artists and thieves who roam the earth.

With elder financial abuse so prevalent, Fool me Once shows my older readers and their children the signs that mom or dad aren’t okay.

“Said they were from My Bank”

“I was at work,” Joe wrote, “using my laptop, seeing patients, when my screen froze and a message stated that it has a virus and to call a number. I did, and a man said he was with my bank and for $400 he can give me antiviral protection on my computer so I can use it. I sent the $400 using a credit card.

“Immediately, he showed my debit card number, said that I paid too much and he will send $200 back to my bank account. Since I never use the card, I thought he was an employee of my bank as he had the card’s number.

“Somehow $44,200 appeared in my account! He instructed me to wire him the extra money and if I do it right away, he would give me $70 and five years of antiviral protection.

“I was trying to be honest and I wired $43,930 the same day. The next day, I realized this was a scam So, I went to my bank’s closest branch and changed my debit card number.”

Joe Discovers No Safeguard from His Bank

Management at his bank said, “You owe us $44,200!”

“I never received an alert via text, email, or mail, of the movement of the money from my home equity line of credit to my bank account. This was not right, as I but never used it.

If I would have been alerted, I would have immediately canceled or not sent the wire.”

Overpayment scammers pressure the victim to “refund” money “mistakenly” placed in their account, but in reality, it isn’t there.

Merely because an account shows an amount of money deposited does not mean the funds are really there, as it could take days for deposits to actually clear and be fully credited. This is another tool scammers use to convince the victim that an overpayment was made.

Upon receiving Joe’s letter, I contacted an executive in the corporate office of his bank who promised to “escalate” his case.

Despite leaving voicemails for her, asking “Don’t you have some safeguard in place to stop suspicious wires — sending money overseas — from an account that never had activity, and explore the possibility of a scam with your customer?”

I am still waiting for a response.

Joe’s letter concluded, “They need to fix this problem. I want my money back. I should not have to pay for their mistake.”

He gave me permission to use his real name, as “I want people to realize how easily they can be swindled and you can’t trust your bank to prevent this known fraud from taking place.”

Bank executives Silent

Can financial institutions prevent money from being wired? You bet they can. And while it is beyond the scope of this story, they have an important role to prevent money laundering and must be alert to potential fraudulent transactions.

“When a wire transaction is outside of a customer’s profile, it should be stopped and the customer asked to come into the bank, if possible. That would appear to be the case with Joe,” said “Banker X,” from a business bank, in my town who asked that both she and her employer remain anonymous.

“We have prevented similar scams from succeeding, as our systems are designed to look for and alert us to unusual customer transactions,” she pointed out.

Interestingly, I ran these facts by press relations and bank officers at a number of banks across America, asking, “Do you have safeguards that would have stopped Joe’s wire from going through, giving time to investigate activity on an account that had never been used?”

Not one bank officer would comment and most never returned my calls. In law, their silence can be seen as an adoptive admission.

Investment Firms Have Safeguards

However, representatives of major investment houses said “Yes, we have algorithms that are looking for the kind of thing that Joe was doing — suddenly wiring over $40,000 from an account he never used before. Everything comes to a halt, and we talk with our customer to see if is legit, or if they are a scam victim.”

One explained, “These scams succeed due to a sense of trust, wanting to do the right thing, and pressure to act immediately. Had Joe taken a step back and actually gone to his bank before wiring the money, the crooks would have lost.”

So, what are Joe’s remedies? I ran this by several attorneys who sue banks, and all agreed that this is a non-starter. They recommended trying to find a tax deduction of some type.

To protect yourself from bank fraud and other scams, visit the Consumer Financial Protection Bureau (CFPB) and find more tips in the article Banking Scams: Beware Fraudsters Impersonating Your Bank.