JPMorgan Chase launched a string of lawsuits on Monday against customers the company accused of exploiting a technical glitch that went viral on TikTok to yank out thousands of dollars.
The glitch in late August let customers deposit big checks in ATMs and withdraw funds immediately before the checks could clear, even if the checks later bounced.
The nation’s largest lender filed complaints in Houston, Miami and two in Los Angeles accusing two individuals and two businesses of illegally hanging on to more than $661,000.
In the largest case, JPMorgan said a Houston man still owes $290,939.47 after withdrawing over two days most of a $335,000 check that a masked man deposited in his account on Aug. 29. The bank said the check was rejected on Sept. 4.
The defendants did not answer, did not accept, or could not immediately be reached with messages seeking comment on Monday.
The civil lawsuits do not exclude or end the possibility of any criminal charges.
All four lawsuits accuse the defendants of violating their deposit agreements, and seek the return of improperly withdrawn funds plus other costs.
JPMorgan, based in New York, said it is pursuing the cases and cooperating with law enforcement to ensure that people are held accountable.
“Fraud is a crime that impacts everyone and undermines trust in the banking system,” JPMorgan spokesman Drew Pusateri said in a statement.
Check fraud is a federal crime. Many banks including JPMorgan let customers access some of the value of their checks until the checks clear.
Last month, the Wall Street Journal reported that the bank was investigating thousands of possible check fraud incidents.
Paper checks are no longer accepted in most European countries. For example, the UK and the Netherlands scrapped them two decades ago.
Yet they remain a popular form of payment in the United States, despite the increased use of digital technology such as ApplePay.
Checks resulted in $26.6 billion in losses globally last year, according to Nasdaq’s Global Financial Crime Report.
