Banking Stories

Last week of 2002-Aug story of Al experiences.

I went to the Integra Bank by Gateway in the Eastland Shopping Mall near where I live in Evansville Indiana, to get some $ out of savings there to move to checking at Old National (Integra account got populated by savings out of Global pay when I could afford to do that), and I learned that is not a good branch to be going to.  You go into the pedestrian walk in entrance and there are these cubicles in lobby using that vacuum tube thing that they have at the drive in windows.

I had a bank statement with me to identify the account, but they need my identity so with some trepidation I loan them my driver's license (got mug shot etc. on it).  Lady shows up to TV screen & we have little chat then she is gone.  Thingy makes its way over, long wait, and different lady at TV screen to ask how she can help me.  I start out "As I said with the other lady ...." and she says she will go get her. 

They will send me everything back with a withdrawal slip for me to sign.  Long wait.  Lady comes on briefly to say she sending it now, then I hear conversation with guy at next booth - they sent the wrong thing to him - he has mine - I ask if he could give it to me, but they already told him to send it back.  Ok, I have my stuff and sign the withdrawal and send it to them.  Long wait.  They send me check.  Lady comes on and tells me the obvious and I thank her.  Then I look at the check.  I push the button to talk again.

I volunteer that on the bottom of this check it says that it is only good up to $1,000.00 but we did this for $1,500.00.  Is that going to cause any problem as the check goes through the banking system, or is this a secret code that means something different to banks than to us customers.  Well she had made a mistake and thanked me for noticing that, so the check goes back for them to fix it. 

While long wait, other lady comes out and hugs boy in booth on other side of me.  I bite my tongue any smart remarks about different service for different customers because obviously mother and son, but when they done, I ask if this arrangement is going to become standard for all their bank branches.  She says no, just this one, and she glad it is only the one.

Then finally other lady gets done and I get what I came in for.  She apologizes for the mistakes - she is just learning this stuff.  I say, that's Ok, once you trained, they will transfer you to a different branch that has different technology.

2001 I think it was when my sister Susan visited and we had a sit down meal with my lady friend and Susan and her husband Dave and we got to talking Banking stories.  I shared the story of the ATM spitting out bills and giving them to the wind instead of to me, so that is why I always cup my hand over the slot to make sure that if the ATM wants to give it to the wind, my hand will grab it before the wind can take it away.  The ladies shared the news that ATMs often issue the wrong currency, and some bank chains are more likely than others to do this.  It has something to do with the quality of employee training, and how easy it is to not put the currency into the right place when the ATM is refilled.  They always hold up the currency to the camera when they take it out, counting it so if it is wrong the camera will see that it is wrong.  Then we talked about sleight of hand, can you give the camera a wrong story?

Apparently one time after visit to ATM, Susan had gone into the bank to tell them that she got an extra $20.00 bill.  Perhaps the Bank thought she was trying to pull some scam and they could not figure out what it was.  Perhaps no other customer had ever volunteered that this happened, so they would have no idea how often this really happens.  Anyhow she was in the bank several hours before this business could be transacted, and it was over a month before correction to her bank account.  What worries her is how many times she might have been short changed by ATM and never bothered to count what she got.

My lady friend, who is an accountant, says her bank often makes mistakes.  She takes bank statement reconciliation in to show them.  They deny that this is possible.  Upshot of this is that sometimes the bank gives her an extra $100.00 that does not belong to her, and sometimes they take $50.00 away that they should not.  Well so long as she has told the bank about this, and the employees are in denial, I think she should get to keep the money, but perhaps it might be safer to send a certified mail to the bank so she has proof that she has told them about this scenario.

I told this story to my co-workers, and learned that it is a well known problem in the accounting profession.  Most ordinary humans do not do such a good job of balancing our check books etc. so that when banks make minor errors, we never notice it, but accountants notice it all the time.  With businesses, the banking errors sometimes give them thousands of dollars errors in the customer's favor, and it takes the banks months to acknowledge that they could have made any such mistake, and correct it.

Banking Virus is why I not want to do electronic banking, where we write e-checks and they get deducted from our accounts and e-deposited directly to our e-commerce contacts.  A guy I used to do business with is now out of business because of the thousands of dollars he lost from several bank accounts because of this.  Understanding the Banking Virus is a complicated story, but I will try to explain it.

In e-banking you have to get some code numbers from the bank and share them with whoever you have an e-banking account with.  So what happens is, a company issues an e-invoice or e-bill, and then the place that owes the money issues an e-check, which takes the money out of your checking account and e-deposits the money in the bank account of the place that issued the e-bill.  It works exactly like paper checks, except it is electronic, and because there is no paper trail, it is vulnerable to cyber criminals.

The weak link is whoever you doing business with who has the weakest computer security, which is the opposite of real life.  Suppose you in business with many people in many different economic circumstances, and one of those people is in a cardboard box or rural shack, with no security whatsoever.  With paper currency, there is no way such a person can drain your bank accounts.  But when you have an e-business trading partner whose computer security is like a cardboard box on the information superhighway, then the cyber criminals get into their financial software and capture the codes neccessary for them to do e-financial transactions with you, and now the cyber criminals are sending instructions to your bank to send all your money to them.

With paper checks and credit cards etc. you can arrange with the bank to have a credit limit, but this is because of decades of abuse with fraudulent checks and stolen credit, that taught the financial industry how to have checks and balances to limit the losses.  But the industry is still new enough at e-banking that they not yet figured out what safeties are needed.

There's lots of software packages for doing your money on your PC, like Quick Books for example.  There are computer viruses that target those packages.  When a computer is infected, the virus collects information about the e-business there and sends the bank routing information to the cyber criminals, who then do fake transactions with the money sent to the criminals.  Thus one PC is infected, but every place that PC owner does business with is then hit by transactions that drain their bank accounts.  The bank can have great security.  The people whose bank accounts are being drained can have great security.  The weak point is if you are doing business with someone whose computer security is like a cardboard box or a rural shack on the information superhighway.

Also my friend who is now in bankrupsy and suing the bank.  He had several bank accounts with the same bank, including the one he used for e-banking.  They all would have been drained, because the bank had no wall between accounts used for e-banking and other accounts.  Even though the business operating out of the e-cardboard-box only had the one account number for my friend, the cyber criminals can work from that to identify other accounts at the same bank, and withdraw from all of them.

My friend and the bank figured out what was happening.  All the accounts that were being drained were closed.  He transferred what was left of his money to a new account that was just opened.  Under bank policies, all new accounts are setup so that they are capable of e-banking, but they can be setup without this.  The branch manager did so.  So now my friend had stopped the outflow, my friend's remaining assets were protected, he was going around town to the other banks he doing business with to ask about protection against any more of this.  Then there were what options available to him since the bank refused to run a trace to find the computer criminals.

As far as the bank was concerned, all the withdrawals were legal.  This has got to be a matter between my friend and whichever one of his clients got hit by the banking virus.  At this point he did not know, and was alerting all of us about the risk.

When Bank HQ saw the new account that had been setup, that was not for e-banking, in violation of their standing policies, HQ did not talk to the branch manager about why, they just fixed what they treated as an obvious mistake by the branch.  The computer criminal you remember was draining all accounts by this person who had a particular social security number at that bank, so now his new account got drained by a series of withdrawals.  It was a week before he knew that was happening.

How do we find out which of our bank accounts are setup so they are at risk of this?

I have money in several different banks, and other types of financial institutions, because I never know what might go wrong in the future.

I have a few other posts to my weblog of similar topics to this one, such as Stop Identity Theft and Stop Phone Spam.  Sometimes a link to one of my stories gets inexplicably broken (with the title in double quotes not being properly translated into a hyperlink, and I cannot figure out how to fix it on a timely basis.  Use this directory of my stories as a backup if need be.  http://radio.weblogs.com/0107846/stories/  Also see Security and e-law categories.

Last update: 11/14/2002; 12:56:28 PM.