Last summer, a viral social media stunt claimed to show people withdrawing huge amounts of cash by exploiting a “glitch” at JPMorgan Chase bank ATMs. The unverified rumor claimed that anyone could deposit a large check to their own account using a mobile device and then withdraw “unlimited money” from an ATM before the bank cleared the check. Some people tried the stunt with varying levels of success. In one case in Houston, a man wearing a mask deposited a phony $335,000 check then withdrew most of the money before the check bounced.
In reality, depositing fake checks is a common form of check fraud — not a money hack. The bank quickly fixed the ATM loophole, and videos of people celebrating sudden riches were replaced with videos of frozen accounts with massive negative balances. Now Chase is suing to get the money back. The bank has filed civil lawsuits against four customers who withdrew between $80,000 and $150,000 in the “infinite money glitch” stunt. The bank asks for the return of the stolen money along with interest, overdraft fees, lawyers’ fees and, in some cases, punitive damages.
Check fraud has a significant impact on the economy even as digital payment platforms, such as Venmo or Zelle, gain popularity. According to Nasdaq’s Global Financial Crime Report, check fraud led to $26.6 billion in losses globally last year. The Chase ATM episode shows how quickly financial misinformation can spread through social media videos. Several TikTok users tried to warn people not to participate: “Chase Bank glitch? No, that’s called fraud,” said one TikTok user in a video that got more than 1 million likes in one day. “You went to the bank and took $50,000 that didn’t belong to you. That’s not a life hack, that’s called robbery.”
Questions:
- Why do you think videos about financial hacks are so popular on social media?
- How can JPMorgan Chase prevent incidents of fraud like this from happening again?