FINANCIAL INSTITUTIONS: E-MAIL SCAMS
Chino Commercial Bank v. Peters, (Fourth District, May 25, 2010) ---Cal.Rptr. 3d ----, 2010 WL 2044682, 10 Cal. Daily Op. Serv. 6502
A bank customer who was victimized by a “Nigerian-style” email scam, was sued by his bank for $458,782.60, the total of three wire transfers made to China at the customer’s request after depositing fraudulent checks from third parties. When the bank sought to attach the customer’s assets, he asserted that he had been duped into participating in an email check cashing scam by a person who claimed to be a citizen of Malaysia seeking assistance in transferring funds from third parties in the United States and Canada who owed him money. The defendant had agreed to deposit the checks in his account and then wire transfer the funds in exchange for fifteen percent of the money, and the bank had confirmed that two of the checks had cleared before wiring the sums. However, all three checks were eventually dishonored and the account was overdrawn in the amount of $458,782.60.
The trial court granted a right to attach against the defendant’s property, reasoning that the customer had been negligent and therefore had the burden of proving that the bank had been negligent. The court of appeal affirmed, holding that under the California Uniform Commercial Code the customer had the burden of proving that the bank acted negligently, and that he had failed to do so:
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