JPMorgan Chase this week began suing more customers it has accused of stealing funds from the nation’s largest bank in last year’s so-called infinite money glitch.
The bank is now going after customers who allegedly stole amounts below $75,000, which means it is filing complaints in state courts, instead of the federal venues it chose last year, according to a person with knowledge of the company’s deliberations.
The glitch, which went viral in late August in videos posted to social media, allowed customers to withdraw the entire value of a fraudulent check before it bounced.
″On August 29, 2024, a masked man deposited a check in Defendant’s Chase bank account in the amount of $73,000.00,” the bank said in a suit filed Tuesday afternoon in Gwinnett County, Georgia.
By the time the check bounced six days later, a series of cash withdrawals at two Chase branches in the state totaling $82,500 had been made, according to the bank.
The accused, whose name is being withheld by CNBC until she can respond, owes the bank $57,847.69, and hasn’t complied with requests to return the funds, according to the lawsuit.
Besides the Georgia case, the bank is filing lawsuits in state venues in Miami; the Bronx, New York; and two Texas counties, said the person, who declined to be identified speaking about the bank’s plans.
The episode highlights the lengths JPMorgan will go to to claw back funds it is owed and to deter future crimes. The bank looked at thousands of potential cases, choosing to litigate the largest amounts with the clearest pattern of theft, said the person familiar.
The bank has also sent letters to more than 1,000 customers demanding they repay funds since October, this person said. Some people returned money on their own after CNBC reported in October that the bank was going after potential fraudsters who had drawn down the largest amounts, said the person.
The lawsuits are separate from potential criminal cases that both federal and state law enforcement may be pursuing, according to the bank.
“We’re still investigating cases of fraud and cooperating with law enforcement — and we’ll do that for as long as it takes to hold fraudsters accountable,” Drew Pusateri, a spokesman for the New York-based bank, said in a statement.
Bankruptcy shield?
JPMorgan is also considering pushing back against the bankruptcy filings of alleged “infinite money” fraudsters.
In one of the bank’s motions made this week in bankruptcy court in Grand Rapids, Michigan, the company asked a judge for more time to object to the customer’s attempt to discharge his or her debts.
The bank is the “holder of an unsecured claim” that resulted from “actions taken by the Debtor to deposit a fraudulent check in the amount of $44,779.46 to which the Debtors immediately made numerous cash withdrawals on August 30, 2024 as well as various Cash App transactions to himself,” the bank alleged.
“There are genuine and important reasons people use bankruptcy protections,” JPMorgan’s Pusateri said. “Getting rid of debts you accumulated through fraud isn’t one of them.”
