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Cyber Risks · Krebs on Security

Double Cashing With Mobile Banking

Summary: A Kentucky man was arrested this month for allegedly using mobile remote deposit capture to steal more than $12,000 from multiple Kroger stores, buying at least 32 Western Union money orders between $195 and $500, depositing each via his Bank of America account, then cashing the same money order at the store and withdrawing the amount from his account. The scheme exploits the fact that mRDC leaves the paper check with the customer, who can present it again, and Aite Group's Julie Conroy said banks cannot detect in real time when an item is deposited via mobile and then again at a branch.

Key Takeaway: Conroy noted that under the regulation's consequential damages provision, the bank handling a second presentment can be liable for unlimited downstream harm - her example being a bounced homeowners insurance check that leaves a house uninsured when it burns down - and Robert McGarvey said a fake-ID account plus a throwaway Walmart phone makes arrest very unlikely, with most banks' roughly $3,000 daily mRDC limit telling a crook he can take $2,999 with no sweat.

Read the original at Krebs on Security ↗

Topics
Data Breaches
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