Beware the banks

[AvalonRetail]

This is a warning tale of what can happen if you get caught by one of the increasingly clever hoaxers. The bank will do nothing to help. In fact they are more likely to treat you like the villain, not the victim. I know this because it happened to me recently.

Following bank advice, my personal and business accounts were linked. Easier when you go online as you only need one password. But when something goes wrong it affects all your accounts. Just imagine how you would manage without access to business or personal bank accounts.

I received a personal email enquiry on my business email address from an import/export company who wanted a place a large order to be shipped overseas. I did everything in my power to determine that they and the order were genuine. I Google searched them and found them on several trade directories. After several days and many email exchanges a deal was done and I was told a large payment had been sent. My bank told me to give IBAN and Swift codes and accept payment directly into my business account. They assured me it was safe and cheaper than paying merchant fees. A couple of days later I received another email from the customer telling me that there had been a mistake and a payment for three times the order value had been sent and could I return the excess. Now it sounded like a scam but I hadn’t shipped the goods so decided to wait and see what happened.

This is where it gets truly scary. I found I couldn’t log on to online banking and when I went to draw cash from my personal account the machine kept my card. Both my accounts, business and personal, were frozen due to the receipt of a large counterfeit cheque into my business account. I was then told by the local branch that the accounts were being closed. I lodged a complaint as I felt this was very wrong. The reason for closing was ‘following a routine review it had been decided I no longer meet their criteria’. Nothing had changed in the way I ran my accounts. No one from Customer Service or Fraud Investigation contacted me during this time. The complaint was denied and the process continued. Both accounts are now closed.

I contacted the Financial Ombudsman, who said the bank must give 30 days notice. I had only been given 14 days therefore the Ombudsman was willing to complain on my behalf but didn’t feel that it would be of much help. Otherwise there was nothing the Ombudsman could do. Any bank can close any account at any time without giving a reason. I also contacted a solicitor who didn’t think any laws had been broken but I might have a claim for ‘distress’.

If you are a sole trader and your credit report isn’t spotless, and whose is these days, the banks don’t want to know. You might just get a personal account with a cash card, no debit card or cheque book, if you’re lucky. A business account seems out of the question.

The truly hypocritical thing is that twelve months ago the bank presented me with an award for overcoming adversity, I’m disabled, and setting the business up. How quickly you can go from star to pariah. They also declare their support for SME’s at every opportunity.

So please be warned. If you have all of your accounts with the same bank then make sure they are not linked. If possible move one to another bank. And if you get an email from anywhere in the world with a large order the safest thing to do is ignore it. It might be genuine and profit lost but better safe than sorry.

[Indizine]

A large order from abroad should ring any small trader's alarm bells. Why even go there? Seems you took a chance many of us would have ignored at that stage and this worried your bank enough to close your account.

Like i said, we (and I say most of us on this forum alone) would have been posting it on here, having a cackle at it their stupidity to think we are so dumb, and let it go. Big orders do NOT suddenly land in your lap. If it sounds too good to be true...it almost always is.

[James Smith]

Bit harsh there Indizine, you make me seem like a fluffy bunny!

Having made the big mistake at the start I think the poster handled it quite well subsequently, in particular no goods shipped or any refund given against the "over payment" which is normally enough for most attempted frauds.

However in this case the bank has played it safe (that is after all what we ask them to do globally) and closed the account. This is quite probably a money laundering issue* and they had no real choice in the matter.


*by banking "dodgy" money in your bank account and repaying it as a refund would "clean" it. Banks can not only get into heaps of trouble for doing this, jail sentences are involved. Banks quite rightly wont take such risks.

[Indizine]

you know me, always objective!

But some people will take the risk and see where they get with it...and some won't. This post is about the banks rather than about scammers, and I believe the bank took appropriate action as it needs to know 100% that you will never compromise your account. It would seem not enough of the right type of checks were done.

BTW, there was nothing harsh about those comments. Just realistic i'm afraid.

[LOS Design UK]

I have to agree with Indi here (for a change)

The banks were spot on with there actions and the business owner seems to have taken a punt.

So the post heading is not appropriate IMHO.

JMTC

[James Smith]

Indi - I whilst i may have thought along the lines of what you posted, I was thinking a more tactful approach would be a little better given this poor person is paddling in the brown stuff and seem to have been rather naive.

Thats me a bloke (who is as 'subtle as a brick' to quote my sister) - ask Phil he knows about my really holding back.

On a wider point I must admit i am fed up with "all banks are evil" posts that seem popular lately when the banks like all other businesses are just that - businesses. They don't lend to people who cant manage their money and can quite rightly withdraw services if they see fit to do so.

I don't have any truck with this "all people are in debt on credit cards" bull. That's fundamental poor cash management to have actually spent at any point what you have not earned.

Ill get off my horse now, it needs watering.

[Indizine]

well, we don't know who this poster is, and tact isn't about giving hugs and kisses, its about being realistic. My comments were exactly that.

The OP blames the bank for taking corrective action yet doesn't have anything negative to say about the actual scammers - so putting my psyhometric qualification to one side (oh, and a proper one I might add ) I found that a bit odd, didnt you?

This is more like it:

Dear sir/madam,

We have closed your account because you took a risk of accepting an unusually large amount of money into your account from an unknown, unvetted source that turned out to be a scammer.

We know you knew this was unusual because you went out of your way to do a lot of checks, unfortunately they are not the correct checks to take to confirm the identity and integrity of an overseas trading business. Google listings and online directories have not been previously known to act in the capacity of credit reference agencies.

Furthermore, and in your own words, you even thought it might be a scam, so you were already on the lookout, so you decided to 'see what happened'. Nice of you to let us know and check with us, seeing as it was our bank you were dicing this potential (you said so youself) scam with.



So harsh? No, realistic? Yes.

The OP took a punt as Daren said, and it backfired

By participating with an overseas unknown entity or person, that deposits a large cheque into your account, for shipping overseas, and you thought a google search and a few dirctories ticked the boxes as being equivalent to 'everything in your power' to determine their auhenticity?

[DavidT]

Just confused a little by one thing.

Was it a cheque or a transfer/electronic payment? If a cheque - who deposited it and where?

[AvalonRetail]

In answer to your question, David T, I have been told very little except that a counterfeit cheque was received.

I thought we were all agreed that scammers are the scum of the earth and that it went without saying.

The whole point of telling my tale was for the final paragraph. Don't let yourself get caught as I did.

I understand the banks need to 'play it safe' and accepted that my business account was frozen. Finding out Saturday lunchtime that my personal account was also frozen was more difficult. Very little cash in the house, an empty fridge and hungry dog. It took several days before I was allowed to withdraw £100. Payment stopped on all domestic direct debits. Both mobile and landline cut to incoming calls only due to non payment. etc etc.

I have tried to open accounts with other banks but have been refused. I eventually found a bank who opened a personal current account with cash card only. I still do not have a business current account.

So yes I have learned a lesson and simply wanted to share it with others to help them avoid falling for a similar very convincing hoax.

[Indizine]

I take it they gave you all the cash that was yours out of the account though? how many days before you got that paid to you?