Check fraud against Chase goes viral on TikTok

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A form of check fraud known as check-kiting went viral on TikTok over the weekend, with JPMorgan Chase customers recording themselves writing a bad check, depositing it at an ATM, then withdrawing cash before the bank could bounce the check.

The scheme was portrayed as a glitch rather than a crime, creating the misunderstanding through seconds-long video clips that customers engaging in the practice would get to keep the money. Other videos showed lines at Chase ATMs of people supposedly looking to try the viral trend themselves.

"Let's go to the ATM, let's go to the ATM, let's go to the ATM," one person said to his friend in a TikTok video reacting to the trend.

Within hours of the videos going up, some of these customers posted videos reacting to negative balances on their accounts, sometimes for tens of thousands of dollars. While many of the original videos have been taken down by either the posters or the platform, reaction videos show some Chase customers with red dollar amounts as large as $30,000 on their account pages.

"They really told me to tap in, next day it was supposed to clear," said one TikTok user who showed a screenshot of his Chase accounts, depicting over $38,000 in negative adjustments. "Look at my account, yo."

A spokesperson for Chase said the bank is "aware of this incident, and it has been addressed." The spokesperson did not elaborate on why some customers were able to withdraw or transfer funds from large checks.

When a customer deposits a check, the first $225 must generally be available to them the day after they make the deposit, according to the Office of the Comptroller of the Currency. The next $5,300 must typically be available the second day, and if the check is larger than $5,525, the bank can hold the rest, often for up to five days.

"Regardless of what you see online, depositing a fraudulent check and withdrawing the funds from your account is fraud, plain and simple," the Chase spokesperson said.

The episode served as a teachable moment for some influencers whose content revolves around financial advice. Jim Wang, who is a personal finance blogger and @bestwallethacks on TikTok, told viewers that errors that appear to be in their favor almost never are.

"Just because money appears in your account doesn't mean it's literally yours," he said. "It's known as unjust enrichment."

Others emphasized the long-term damage that the fraud scheme can have on people who attempt it. @Seansvv on TikTok, whose content often involves reading the terms of service of various companies, emphasized the data that banks including Chase collect on customers, often to comply with legal obligations to do so. The influencer stressed that banks can share this data with authorities and each other to identify and avoid high-risk customers.

"The debt is going to follow you, especially the people with upwards of $10,000 of debt," he said. "There's basically no way you're going to escape this; you're going to have to figure a way to make that money back."