JPMorgan Chase & Co JPM has initiated legal action against customers who allegedly exploited a technical flaw to withdraw funds from ATMs before checks bounced.
What Happened: The bank has filed lawsuits in three federal courts, targeting individuals who made the largest withdrawals during the ‘infinite money glitch’ that gained attention on social media platforms like TikTok in late August, CNBC reported on Monday.
One such case in Houston involves a man who owes JPMorgan $290,939.47 after an unidentified accomplice deposited a counterfeit $335,000 check at an ATM. The bank alleges that the man began withdrawing the majority of the funds after the check was deposited.
“We’re pursuing these cases and actively cooperating with law enforcement to make sure if someone is committing fraud against Chase and its customers, they’re held accountable,” JPMorgan spokesman Drew Pusateri said, according to the report.
Why It Matters: JPMorgan, the largest U.S. bank by assets, is investigating thousands of potential cases related to the ‘infinite money glitch.’ The bank has not disclosed the extent of the associated losses.
Despite the decreasing use of paper checks, they remain a significant avenue for fraud, resulting in $26.6 billion in global losses last year, according to Nasdaq’s Global Financial Crime Report.
On the regulatory front, JPMorgan’s CEO, Jamie Dimon, delivered a sharp critique of recent regulatory efforts, calling for banks to take a firmer stance against rules he believes are misguided. Speaking at an American Bankers Association conference, Dimon argued that overlapping regulations have created an unfair playing field, leading to unjust penalties for financial institutions.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
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