Patrick Combs - Stories

Bank Error In My Favor: Collect $95,000 / ORIGINAL version.
© 1995 Patrick Combs

Learning My Rights

I arrived in New York still quite shook up from the telephone call with the Security Officer. The words 'fraud' and 'policemen' and 'not willing to cooperate' kept echoing in my head. I decided it was time to learn my rights.

A few quick phone calls to law schools and I had a list of Bay Area lawyers who specialized in banking and checks. I decided to call Manuel Fields first because of his specialty, check fraud.

I told Manuel my first name and asked him if I could tell him my situation to determine whether or not I needed a lawyer. "Sure" he said. I told him the entire story (without mentioning the amount of the junk mail check). He laughed a bit and asked, "Exactly how much was this check for??" I was really hesitant to tell a lawyer the astronomical amount, but I couldn't lie so I said, "$95,093.35." Next, for what seemed like a full minute, all I heard was a man laughing very very hard. "I'm sorry," he said after he completed his laugh. "I've just never heard of anything like this."

Manuel went on to inform me of things that further amazed and intrigued me:

* According to Commercial Paper Law the money was now legally mine, because all checks are first assumed to be valid -- and the way a bank invalidates a check is by serving the depositor with a timely notice of dishonor. Considering that it took my bank 33 days to tell me my check had been returned, he did not think they had dishonored the check in time.

* Fraudulent checks ARE a different manner. But he said, "Since you deposited the check 'thinking there was no chance it would cash, and without even endorsing it' -- you didn't commit fraud."

* Getting the cashier's check was also not an act of fraud, since the bank had previously assured me the check could no longer be returned.

* There are two practices of law as seen through the eyes of a court: (1) Black Letter of Law, where the court rules strictly by the law (and I would be awarded the money) and (2) Chancery Courts, also known as Courts of Compassion, where the court disregards the law when it is deemed non-sensical. He said that, "Easily a court could disregard the law and give the money back to the bank because really you have no claim to this money from an equitable sense of the law." And then he added, "And when it's an individual vs. a Bank, I'm sorry to say that courts usually side with the bank."

We agreed to speak again the next day.

When I called him I continued to protecting my anonymity by giving my first name only. It all felt so spy-like. I spoke very little and listened carefully. It had been 24 hours since we first spoke and he had these comments to add:

* I definitely didn't commit fraud because I didn't consummate an act of fraud. I had not cashed the check. But it could be perceived that I attempted to fraud the bank. Proving I had not would require a legal deposition that detailed what I was thinking when I made the deposit and what expectations I had about what I'd do if the money showed up in my account.

* The burning question now (for legal purposes) was, 'WHERE did the money come from?' He presumed the bank in Ohio (The get-rich-quick company's home state), was the bank that was minus $95,093.35. And he stated that they would have to eat the loss if they hadn't sent the check back to my bank on time.

We ended the conversation with no plans to speak again.

The next part of my vacation was at my brother's house in Boston. It was a two week family get-together -- my mom and God son were also there. We spent very little time talking about the money, but when we did everyone thought it was an amusing incident, everyone except my Mom. It stressed her out a lot. She worried that the bank would get meaner and meaner, and that they might try to throw me in jail. One day I jokingly told her I was going to buy her a Lexus with presents in the back. She smiled for an instant and then she pinched my arm and said, "You better not!"

My Mother helped me a considerable amount. One day I went into my brother's home office. I was upset because I had requested a photocopy of the check from my bank and instead they had sent me a photocopy of someone else's $6.71 check. I wanted to see what the sample check I had deposited looked like. It seemed like my only option was to call the Security Officer with my request. But then my Mom came in and pulled up a chair next to me. After hearing what I wanted, she said, "Patrick you don't have to speak to a Security Officer about this. Call the President of the Bank. Haven't I taught you to deal with VIP's?! They're the ones with true power." And then, as I tried to reach the President of First Interstate Bank by phone, my Mom just sat there giving me strength.

It took many phone calls (more than it should!) to find out the name and number of the President, and when I did call for Bill Siart, I was told that the Consumer Affairs Department was as close as you can get. I reached the manager of the department and said, "I have a problem with my branch office and I'm looking for help. I want to resolve this amicably, without a lawyer, but I'm having a lot of trouble speaking with anyone who wants to help me handle this fairly." Instantly the manager became helpful. I requested a photocopy of the front and the back of the check and an official letter from the bank. When I told her that Robert Gage in Security had denied me a letter, she recognized Gage as someone high up in Security, and she assured me she would call him and see if it was possible for me to get such a letter. She lived up to her promise because by the next day Robert Gage was faxing the things I requested to me in Boston.

What arrived by fax was a surprise. It was incredible to see the and back of the check. I had not remembered just how real it looked -- and it was actually the first time that I could confirm that it in fact matched all nine criteria for a negotiable instrument. Up until then I had just been working from memory.

But what really surprised me was the 'official letter' from my bank stating the check's return. What came out of the fax machine wasn't any sort of letter from my bank -- it was a memo from First Chicago Bank -- and it was a piece of the puzzle of how this whole thing could have happened.

The memo (which had the amount of my check on one line and the word 'non-negotiable' circled on another) had a name and phone number for an Account Adjuster on it. I decided to call. My brother always says, "More information is always good."

I reached the man on who had written the memo. I explained to him who I was and why I was calling. He explained that the memo I now possessed was the notice of dishonor that he sent to my bank about the $95,093.35 check. On the same day that he sent the memo, his bank also reclaimed $95,093.35 from my bank. So MY bank was out the money! "Yes," he confirmed. "All the other bank's involved have recovered their money."

Suddenly it dawned on me, this memo was dated June 5th. That's the day my bank learned that the check had been dishonored. Why they waited until June 21st to notify me was a mystery, especially considering that legally they were supposed to notify me by Midnight of June 6th! No doubt about it now, my bank had made a big mistake -- AND they faxed me a memo to prove it!

At the end of the conversation this man did me another big favor, he obliged my request for the names of the other banks involved. He didn't even mind telling me who I should ask for directly and what item number I should reference.

From calling the other banks involved I learned the movement of the check and the details of the fiasco. I deposited the check on Friday, May 19th. On Monday, May 21st it was overlooked by my bank and sent onto the bank in Chicago that was acting as a clearinghouse. It was again overlooked there. The next day, on May 22rd, it was sent onto the Federal Reserve Bank in Cleveland OH and this bank rejected the check, calling it a 'non-cash' item (Whether or not it SHOULD have been rejected as a 'non-cash' item is questionable in my mind considering what I learned about the meaninglessness of the words 'non negotiable' on a check, but that's what the FED said). Take note that the FED Bank rejected the check within 48 hours of when it left my bank. The check was then routed to the get-rich-quick company's bank in Cleveland. The Cleveland bank says they sent a notice of dishonor immediately to the bank in Chicago. I cannot confirm when the Cleveland bank actually sent their notice of dishonor, but I do know that the bank in Chicago sent my bank notice of dishonor on June 5th.

I've read that bank computers are programmed to bring special attention to checks above $500. Can anyone tell me why any bank would delay attending to a dishonored $95,093.35 check with the words 'non-negotiable' on the face, when they know they have a Midnight Deadline?? If you're Commander of the NASA control room, and you notice a disastrous leak five minutes before the shuttle launches, that is something you attend to immediately. (I know, bad analogy).

Back to the story. After learning the path of the check, I made an entry into my journal:

The bank knows they made a big mistake. But instead of calling me and explaining their mistake, they called and bullied me with scare tactics, "banking" on my being ignorant and fearful. Apparently they feel they're powerful enough to avoid admitting to their mistakes and powerful enough to deny me even the right to fair treatment -- refusing to even send me a letter about this. I don't think they're that powerful."

Part V: Beating Fear!"