JPMorgan Sues TikTok Users Exploiting ‘Infinite Money Glitch’ To Withdraw Fraudulent Funds

Key Takeaways

• In August, a viral TikTok trend described an “infinite money glitch” that let Chase customers withdraw money before a check cleared.
• Now, the bank has sued four customers who participated in the fraud.
• JPMorgan said it intends to hold fraudsters accountable.

On Monday, Oct. 28, JPMorgan Chase filed lawsuits against four Chase customers who allegedly committed check fraud using a technique described in viral TikTok videos.

The lawsuits seek to claw back funds customers obtained fraudulently, noting that the defendants violated the terms of their account agreements.

Viral TikTok Fraud Lands Customers in Court

In August, TikTok videos began circulating that exposed a so-called “infinite money glitch.” 

Normally, Chase allows account holders to withdraw part of a check before it clears. However, according to media reports, for several days in August, a technical error allowed customers to withdraw all of the funds from a check before it had cleared.

TikTok videos described a method where individuals could deposit fake checks for large amounts into their bank accounts and immediately withdraw the funds before the checks bounced.

After the glitch went viral, the bank filed four lawsuits in different states, accusing individuals of fraud.

JPMorgan Defrauded by Over Half a Million

According to JPMorgan, the defendants withdrew over $660,000 in funds before the checks were flagged as fraudulent. 

In comments to CCN, Independent Community Bankers of America Vice President Scott Anchin said the incident highlighted the need for constant vigilance against evolving fraud threats.  “The ‘infinite money glitch’ is a great illustration,” he observed, “as checks, in particular, are especially vulnerable to theft and manipulation”.

The most egregious case case litigated so far involved a Houston resident who deposited a fake check worth $335,000.

After withdrawing a significant portion of this amount, the bank reversed the fraudulent transaction, leaving the customer with an outstanding debt of $290,939.47.

Similar lawsuits have been filed in Florida and California , where other defendants are accused of using the same fraudulent techniques to pocket large sums. 

More Lawsuits Pending?

While JPMorgan has only sued a handful of Chase customers so far, according to the Wall Street Journal, thousands of people may have taken advantage of the glitch before the error was fixed.

Each of the four complaints stated: “Chase takes its responsibility to combat fraud seriously and prioritizes protecting the firm and its customers to make the banking system safer.”

“Part of that responsibility is to hold people accountable when they commit fraud against Chase and its customers,” they added.