Guy gets paid 100k when he was supposed to get 1k, gets charged with theft.

[helmuth_hubener]

The fundamental issue is involving the police, prematurely, in what ought to be a civil dispute.

Once again, what difference does it make if this is "criminal" or "civil"? This seems like an artificial and not inherently useful distinction. In a free society, would some things be "civil" and others be "criminal"? What's the difference? Are not the police involved in "civil" disputes? Of course they are, even in current-day USA, and certainly they would be in a free society as well. Forcible judgements need to be enforced.

X wrongs Y. If that wrong is one that libertarianism says can be rightly addressed by using violence, then force and violence and all of that jazz can be brought to bear against X. The goal being to make Y whole. In this situation, clearly X (Cesar) has wronged Y (steel company), and so whatever force and violence is necessary can (provided Y agrees, is not a pacifist or something) be brought to bear in order to remedy the situation. Is that civil? Is that criminal? Whatever you call it, it is using force to make Cesar comply and do the right thing, since he won't do it himself. That's what happens sometimes when you won't do the right thing. You get to do the right thing with a gun to your head.

So, in conclusion, let me say that it appears everyone here largely agrees with each other. Everyone thinks that Cesar should not have kept the money, and that the company should get it back:

2.) I don't think he should keep the money, never did.

I said there is legal recourse. I have said that repeatedly.

[M]e getting it back requires a CIVIL court action.

No one is saying there is not a legal way for the company to get the money back.

The main hang-up seems to just be over this civil vs. criminal thing. Free Hornet, newbitech, RickyJ, and a few others seem to:

a) be giving Cesar the benefit of the doubt as to good intentions, not being dishonest and despicable, etc. Now this is ridiculous because clearly he did act dishonestly and despicably, but I can understand the instinct to always take the side of the little guy, the "underdog".

b) Have a dislike for cops and don't like them kicking in doors, or indeed being involved in anything. Of course, this is the correct attitude and how all decent and informed people feel.

c) have an aversion to locking people in cages. I share that aversion, and perhaps angelatc does not, but whether or not incarceration is part of a civilized society is really a different issue than whether this man has dishonestly gotten this money from the company and needs to have it forcibly taken from him and returned to the company -- at gunpoint, if necessary. On that latter issue, we all seem to agree. The money is not his, and the company can legally get it back. "Legally" means: "with a gun".

 

[angelatc]

c) have an aversion to locking people in cages. I share that aversion, and perhaps angelatc does not, but whether or not incarceration is part of a civilized society is really a different issue than whether this man has dishonestly gotten this money from the company and needs to have it forcibly taken from him and returned to the company -- at gunpoint, if necessary. On that latter issue, we all seem to agree. The money is not his, and the company can legally get it back. "Legally" means: "with a gun".

The problem is that he likely does not have all the money. A gun won't help that.

As for the rest of it, I'm not an anarchist. I believe that some people will agress, and the state should be an organization to defend against them.

I don't think they state wants him to be locked up. I think they will drop the charges when he pays the money back. I'm fine with that.

But I'm not against using force to make people do the right thing, and that's what this is.

As for the civil vs criminal - it's a game of cat and mouse. If the company had a lawyer that advised them that criminal charges could be levied instead of just pursuing some weak-sauce judgement against a guy with no assets who will likely change jobs every time they get a new order to attach his wages, then I say bully for them.

If he doesn't pay the money back, should he be sentenced and imprisoned as a thief? Well, it's either that or cut off his hand, I guess.

 

[angelatc]

1
I know you have already prosecuted the man in your mind, but I think you can't do that if I am able to establish that the legal status of the money in his account is/was a payroll advance. Agree?

No.

I am not going to keep rehashing the same points over. You're mistaken in your interpretation of the employer's handbook section, but I can't seem to commuicate effectively on that subject, so I'm going to just have to live with the fact that you're wrong.

There is absolutely no law that says a payroll advance MUST be repaid by garnishment. In Texas, there are laws that say it can be.

US law views wage over payment in the same way it views a payday loan or advance ONLY in the respect that federal rules do not prohibit the employer from deducting the money from an employee's subsequent earned wages.

 

[helmuth_hubener]

But I'm not against using force to make people do the right thing, and that's what this is.

Anarchists (of the libertarian variety) are not against that either. I was not saying that forcing Cesar to do things -- at gunpoint, if necessary -- is bad. It isn't. I apologize if it came across that way. Defensive force-using, defensive coercion, defensive gun-pointing, all of that is allowed under libertarianism.

If he doesn't pay the money back, should he be sentenced and imprisoned as a thief? Well, it's either that or cut off his hand, I guess.

Well, him being in prison doesn't get back the money either, in that case, and neither does the severing of his hand.

In a libertarian society, restitution to the victim is the number 1 priority of justice. So the agents of the law may do whatever is necessary to get that money back. If that means locking him up until he divulges the secret location of the cash, fine. It could also mean forced labor. Now Cesar will probably be more productive out of prison than in, so he would likely be put at large rather than kept in prison. That would be in the victim's best interests. He might be outfitted with a tracking bracelet or implant or something. Perhaps a spine-clamp which also serves to identify him as a criminal and the nature of his crime. Certainly detectives could feel free to violate his privacy and track down where the money went.

So you're right, slimeballs are slippery and should not be allowed to slip away. A free market in the provision and enforcement of justice would be far more likely to prevent him from slipping away. Because they actually have an incentive to do so. A monopolist does not have that incentive.

 

[angelatc]

1.) seriously I don't know. From what I could read and see, the direct deposit is an EFT. In my experience, and erroneous EFT is handled by contacting the bank and showing evidence of the error. I have gone through this process and have had the funds provisionally credited to my account until the outcome of the investigation was resolved. What did suck was that until the specific FDIC mandated time period had elapsed for investigative purposes, the existing funds in my account that had nothing to do with the error were frozen. That was my personal experience with EFT. I have also seen deposit accounts get frozen in much the same manner, because of "usual account activity" when there was a surge in incoming EFT's. .

As a consumer, you have 60 days from the receipt of your statement to challenge money taken out of your account via ACH. That's a different rule. Reversing a deposit made in error must be done in 5 days. No bank visit required - the same software that generated the transfer can generate the reversal.

If you doubt my word that te NACHA writes the rules for reversals, I encourage you to check the FDIC regulations, http://www.fdic.gov/regulations/information/ebanking/66FR15187.pdf

2(m) Unauthorized Electronic Fund Transfer


Certain payments often are made to a
consumer’s account through the ACH,
such as direct deposits of payroll or
government benefits. NACHA rules
permit reversal of payments made in
error in limited circumstances.
Comment 2(m)–5 is added, with some
modifications from the proposal, to
clarify that reversals of certain direct
deposits that were made in error are not
‘‘unauthorized’’ EFTs. The last sentence
in paragraph (iii) of the proposed
comment, referring to a dispute about
whether the account holder is entitled
to a certain amount, has been deleted

If you want to read the NHCHA rules, they're here: http://www.achrulesonline.org/achrules.aspx User name Ron Paul, password RonPaul

 

[angelatc]

Well, him being in prison doesn't get back the money either, in that case, and neither does the severing of his hand.

There's a distinct chance they'll never get the money back.

In a libertarian society, restitution to the victim is the number 1 priority of justice. So the agents of the law may do whatever is necessary to get that money back. If that means locking him up until he divulges the secret location of the cash, fine. It could also mean forced labor. Now Cesar will probably be more productive out of prison than in, so he would likely be put at large rather than kept in prison. That would be in the victim's best interests. He might be outfitted with a tracking bracelet or implant or something. Perhaps a spine-clamp which also serves to identify him as a criminal and the nature of his crime. Certainly detectives could feel free to violate his privacy and track down where the money went.

Too much power for the state. It is fine on paper, but once they start adding court costs, attorney fees, interest....eventually you have an actual incentive to barnd people as theives to force them into perennial indentured labor.

So you're right, slimeballs are slippery and should not be allowed to slip away. A free market in the provision and enforcement of justice would be far more likely to prevent him from slipping away. Because they actually have an incentive to do so. A monopolist does not have that incentive.

There's certainly no perfect system. But have I mentioned I've done payroll? Civil judgements are the worst possible solution, imho.

 

[The Free Hornet]

Once again, what difference does it make if this is "criminal" or "civil"? This seems like an artificial and not inherently useful distinction.

Civil proceedings are required to determine who owes what or if nobody owes anything. So that $53,221.79 he got after tax, adjudication must decide (assuming they don't come to an agreement themselves):

- how much is pay Cesar is due?
- was there an employment contract? what did it say?
- how much is vacation Cesar may be due (depending on the company's internal policy)?
- how much is extra pay or bonus? [subpoena the records to find out how much ownership, top management, and other employees have been given at Texas Steel Conversion]
- how much is compensation for legal difficulties and costs caused by Texas Steel Conversion?
- how much is compensation for accounting costs and time lost caused by Texas Steel Conversion?
- how much is compensation for a false arrest and police report?

More so, a civil proceeding will look at the details if Cesar owes money:

- is this a payroll advance or loan, ought Cesar to return to work or make regular payments?
- if a loan, what is the interest rate?
- is $X due immediately?
- how much does Cesar have in assets now, what is to be paid?
- if Texas Steel Conversion owes Cesar additional money, what are their payment terms?

To sum:

CRIMINAL - donut munching cop makes piss poor analogy and doesn't know shit:
"It's kind of like if you saw money sitting on the register, you know it's not yours. If you don't make attempts to find the owner, then you're committing theft," said Officer Kelley McKethan, Bryan Police Department. This route could cost Texas taxpayers $250,000 if Cesar serves 10 years and I doubt it gets any money back for Texas Steel Conversion.

CIVIL - Tax, payroll, accounting experts and bar-certified Judge weigh the law, the facts at hand and come to a hopefully reasonable solution to accomodate all sides with minimal additional expense (as that only hurts the pockets of Texas Steel Conversion and Cesar).

So, in conclusion, let me say that it appears everyone here largely agrees with each other. Everyone thinks that Cesar should not have kept the money, and that the company should get it back:

No, I think a Judge or Jury needs to decide if the two sides can't come to an agreement. Texas Steel Conversion admits to owing him a paycheck. The size of that paycheck is one of the issues as well as the costs of their screwups.

"Ought Cesar have kept the money?" The issue - IMO! - is if the money is to be returned, how ought to be returned and what sum. I would have at least an accountant and maybe a lawyer as well in my service and would expect Texas Steel Conversion to pay for those.

I'm not going to slosh around $53,221.79 without some damn solid paperwork explaining the implications.

This is a large payroll error and not like returning a lost scarf.

In a libertarian society, restitution to the victim is the number 1 priority of justice.

Not when you fuck yourself.

Not when you don't bother to use a civil court, tax or legal experts.

Not when NOBODY initiated violence against you or engaged in fraud.

If I'm solving crimes, victims of violence are at the top ("number 1 priority of justice") and people that give away their money and later regret it are among the least of my priorities. But, hey, that's just me.

 

[angelatc]

CRIMINAL - donut munching cop makes piss poor analogy and doesn't know shit:
"It's kind of like if you saw money sitting on the register, you know it's not yours. If you don't make attempts to find the owner, then you're committing theft," said Officer Kelley McKethan, Bryan Police Department. This route could cost Texas taxpayers $250,000 if Cesar serves 10 years and I doubt it gets any money back for Texas Steel Conversion..

Riiiiight. Maybe you don't know this, but most police departments have financial crime divisions. It's pretty likely they investigated this and determined that there were sufficient grounds to file a criminal instead of a civil case. Hence the use of the word "Investigators" in their statement.

Not when you don't bother to use a civil court, tax or legal experts.

It's pretty hysterical to see you assuming they don't have any expert legal advice just because they're not handling this case the way you think they should. Even though we're not experts, we've shown you several other cases of unreimbursed deposit errors being prosecuted criminally.

 

[newbitech]

As a consumer, you have 60 days from the receipt of your statement to challenge money taken out of your account via ACH. That's a different rule. Reversing a deposit made in error must be done in 5 days. No bank visit required - the same software that generated the transfer can generate the reversal.

If you doubt my word that te NACHA writes the rules for reversals, I encourage you to check the FDIC regulations, http://www.fdic.gov/regulations/information/ebanking/66FR15187.pdf




If you want to read the NHCHA rules, they're here: http://www.achrulesonline.org/achrules.aspx User name Ron Paul, password RonPaul

Thanks for the links, in trying to understand these rules, I wanted to know what the definition of "Settlement Date" was. I came across a rather interesting discussion.

http://www.bankersonline.com/technology/guru2006/gurus_tech070306c.html

NACHA's Settlement Date or Reg E's Statement Date? (Reg E of the Electronic Funds Transfer Act)

While this specific case is different, the question I believe still remains. What is the appropriate rules/laws to apply and more importantly WHEN?

Nacha appears to be the industry "rule book", while EFTA is the legal basis for which those rules are written. In terms of liability, I think that EFTA is the appropriate law to source.

You are right tho, from what I could read in the NACHA rules and from what I gathered in the discussion I linked, the company had 5 days after the funds what "cleared"? to process a reversal.

So obviously if that mistake took more than 5 days after the reversal to be recognized, NACHA was not going to help the company out in reversing and recovering from their mistake.

So now, the question becomes that of the EFTA which states that if the company properly notifies the bank within 60 days of the unauthorized transactions they have ZERO liability.

EFTA also goes on to state that there is liability proportional to the amount of time greater than 60 days to the time of notification. Since this particular transactions is considered an erroneous entry that 60 days is furthered extended to included the amount of time it takes to recognize the error on a regular periodic statements.

I draw your attention to the Comptrollers Handbook, Consumer Compliance Examination, which analyzes Regulation E of the ETFA.

Section V. Consumer Liability and Error Resolution.

http://www.occ.gov/publications/publications-by-type/comptrollers-handbook/efteare.pdf

So still maintain that this case is governed by that law. The NACHA rules would have been helpful if the company was aware of their mistake quickly enough to reverse the transaction, but clearly that is not the case. NACHA has no provisions for actually liability, however the company is still able to 100% indemnify themselves under Federal for a time period between 60 and 90 days after their mistake.

After 90 days, it is quite clear that the law places liability on the company.

So if they didn't discover their error more than 90 days (assuming 30 day mailing cycles for statements) or if they simply failed to notify the bank of the erroneous and unauthorized amount the law makes it clear that they will be liable for the loss of a portion, up to ALL of those funds.

That is because they have to provide documentation and the burden of proof is on the financial institution to show that the transaction was authorized. If the company does not provide any evidence that the transaction was unauthorized, then the financial institution and the EFTA considers that transaction to be valid and authorized.

So I have a couple questions/observations
1.) If the concern was to recover their alleged stolen property, why did the not go to the bank, since the bank controls those funds for them?
2.) They had 90 days from the time the direct deposit cleared to notify the bank and have 0 ZERO liability for the erroneous transaction.
3.) In fact, even if there was some extenuating circumstances 90 days from Feb 1 is May 1. So even if they went to the bank right now, they could recover a huge chunk of their mistake.
4.) The bank would have provisionally credited their account already had they made this inquiry within 90 days.
5.) There was absolutely no reason to approach the employee or go to the police to recover these misappropriated funds which the company is 100% at fault for misappropriating.
6.) Two sets of laws Employment laws with regards to overpayment in the category of a loan/advance, and Finance law wrt EFT both seem to indicate that the liability for this mistake is 100% in the company's hands. No where so far have I seen anything that have nullified any of those laws in this case.
7.) The best criminal law we have is the theft by misappropriation. I think it's pretty clear that the company did the misappropriating in this case.
8.) Perhaps they did go to the bank and have already recovered their money and now they are trying to punish the former employee for daring to control the funds in his account?


We could go on and on about this. I think you've made some great points and showed me some things that I wouldn't have known about since you are in payroll and ***edit *I have no knowledge* have no knowledge of any of that stuff.

I can't really cast any judgement on the guy cause I don't have all the facts. Knowing what I know about banking (worked in the "engine room" for a bank for 4 years), there was a very easy path for a responsible company to correct this error. A path that didn't involve publicizing their ignorance, and a path that didn't involve sending an employee to jail.

I don't think the guy is a thief. So far, his legal status is in fact NOT a thief. If the law decides to eventually label him as a thief, I think it will be a dangerous precedent and/or reinforcement of a dangerous set of rulings that will give someone who owes me money a legal option for screwing me over with the assistance of lawful violence and coercion at the hands of the state.

 

[angelatc]

Once again, what difference does it make if this is "criminal" or "civil"

I had a thought about this while I was washing dishes. The rules of evidence make getting a criminal conviction much harder, and the "reasonable doubt" standard doesn't apply in civil court.

If the justice system would not allow the company to pursue the civil matter if the criminal case failed, this could have been a blessing in disguise for that thief.

 

[angelatc]

Thanks for the links, in trying to understand these rules, I wanted to know what the definition of "Settlement Date" was. I came across a rather interesting discussion.

http://www.bankersonline.com/technology/guru2006/gurus_tech070306c.html

NACHA's Settlement Date or Reg E's Statement Date? (Reg E of the Electronic Funds Transfer Act)

While this specific case is different, the question I believe still remains. What is the appropriate rules/laws to apply and more importantly WHEN?

Nacha appears to be the industry "rule book", while EFTA is the legal basis for which those rules are written. In terms of liability, I think that EFTA is the appropriate law to source.

You are right tho, from what I could read in the NACHA rules and from what I gathered in the discussion I linked, the company had 5 days after the funds what "cleared"? to process a reversal.

So obviously if that mistake took more than 5 days after the reversal to be recognized, NACHA was not going to help the company out in reversing and recovering from their mistake.

So now, the question becomes that of the EFTA which states that if the company properly notifies the bank within 60 days of the unauthorized transactions they have ZERO liability.

EFTA also goes on to state that there is liability proportional to the amount of time greater than 60 days to the time of notification. Since this particular transactions is considered an erroneous entry that 60 days is furthered extended to included the amount of time it takes to recognize the error on a regular periodic statements.

I draw your attention to the Comptrollers Handbook, Consumer Compliance Examination, which analyzes Regulation E of the ETFA.

Section V. Consumer Liability and Error Resolution.

http://www.occ.gov/publications/publications-by-type/comptrollers-handbook/efteare.pdf

So still maintain that this case is governed by that law. The NACHA rules would have been helpful if the company was aware of their mistake quickly enough to reverse the transaction, but clearly that is not the case. NACHA has no provisions for actually liability, however the company is still able to 100% indemnify themselves under Federal for a time period between 60 and 90 days after their mistake.

After 90 days, it is quite clear that the law places liability on the company.

So if they didn't discover their error more than 90 days (assuming 30 day mailing cycles for statements) or if they simply failed to notify the bank of the erroneous and unauthorized amount the law makes it clear that they will be liable for the loss of a portion, up to ALL of those funds.

That is because they have to provide documentation and the burden of proof is on the financial institution to show that the transaction was authorized. If the company does not provide any evidence that the transaction was unauthorized, then the financial institution and the EFTA considers that transaction to be valid and authorized.

So I have a couple questions.
1.) If the concern was to recover their alleged stolen property, why did the not go to the bank, since the bank controls those funds for them?
2.) They had 90 days from the time the direct deposit cleared to notify the bank and have 0 ZERO liability for the erroneous transaction.
3.) In fact, even if there was some extenuating circumstances 90 days from Feb 1 is May 1. So even if they went to the bank right now, they could recover a huge chunk of their mistake.
4.) The bank would have provisionally credited their account already had they made this inquiry within 90 days.
5.) There was absolutely no reason to approach the employee or go to the police to recover these misappropriated funds which the company is 100% at fault for misappropriating.


We could go on and on about this. I think you've made some great points and showed me some things that I wouldn't have known about since you are in payroll and have no knowledge of any of that stuff.

I can't really cast any judgement on the guy cause I don't have all the facts. Knowing what I know about banking (worked in the "engine room" for a bank for 4 years), there was a very easy path for a responsible company to correct this error. A path that didn't involve publicizing their ignorance, and a path that didn't involve sending an employee to jail.

I don't think the guy is a thief. So far, his legal status is in fact NOT a thief. .

So far his legal status is an accused thief.


The NACHA won't help collect money, period. They are a legislative body, not an enforcement arm. If the company had tried to reverse the money within the 5 days only to find out that he had already moved it, the company would still be out of luck. They can't chase him from bank to bank. Unless they get a court order to garnish his bank account, he has the money.

1.) If the concern was to recover their alleged stolen property, why did the not go to the bank, since the bank controls those funds for them?
2.) They had 90 days from the time the direct deposit cleared to notify the bank and have 0 ZERO liability for the erroneous transaction.
3.) In fact, even if there was some extenuating circumstances 90 days from Feb 1 is May 1. So even if they went to the bank right now, they could recover a huge chunk of their mistake.
4.) The bank would have provisionally credited their account already had they made this inquiry within 90 days.
5.) There was absolutely no reason to approach the employee or go to the police to recover these misappropriated funds which the company is 100% at fault for misappropriating.

You're confusing consumer rights to challenge a charge or withdraw from your own account with the right of a firm to reverse a direct deposit within 5 days. And even if they did try to reverse the deposit (which they may have) they can't if the money is already gone. Which it was.

There was not an easy way to correct this. There was no easy way to pull the money back out. He already appropriated it from his account.

He wanted nothing more for them to try to chase the money. They put a quick end to that game.

Most of the time, the police investigate these things and tell the complainant that it's a civil matter. They investigated this one and concluded it was a criminal matter.

 

[newbitech]

I had a thought about this while I was washing dishes. The rules of evidence make getting a criminal conviction much harder, and the "reasonable doubt" standard doesn't apply in civil court.

If the justice system would not allow the company to pursue the civil matter if the criminal case failed, this could have been a blessing in disguise for that thief.

I think it matters because of the penalties imposed. As far as blessings in disguise, lol, someone puts 50k in your bank account and calls the cops on you and you go to jail. Feel blessed?

I can see the scenario where the guy doesn't go to jail and just sort of gives up his rights to be informed about the mistake in his bank account, one big ass hassle cause by the company screw up.

How about some accountability for the people that actually CAUSED all this to happen in the first place? What kind of crime can we accuse them of? I think they committed wire fraud. I think the overpayment was intentional and was an attempt to find a reason to deprive the man of his liberty. So far its working out for them yeah?

 

[newbitech]

So far his legal status is an accused thief.


The NACHA won't help collect money, period. They are a legislative body, not an enforcement arm. If the company had tried to reverse the money within the 5 days only to find out that he had already moved it, the company would still be out of luck. They can't chase him from bank to bank. Unless they get a court order to garnish his bank account, he has the money.





You're confusing consumer rights to challenge a charge or withdraw from your own account with the right of a firm to reverse a direct deposit within 5 days. And even if they did try to reverse the deposit (which they may have) they can't if the money is already gone. Which it was.

There was not an easy way to correct this. There was no easy way to pull the money back out. He already appropriated it from his account.

He wanted nothing more for them to try to chase the money. They put a quick end to that game.

Most of the time, the police investigate these things and tell the complainant that it's a civil matter. They investigated this one and concluded it was a criminal matter.

People make false accusations all the time. Actually, I am not confusing them. I wasn't sure about the ability to reverse the EFT, which is why I asked you about it. I am 100% sure about the ability of the company to go to their bank and file an erroneous transaction claim. I gave a couple examples of that already from my experience.

Yes there was an easy way to correct it. Company realizes they screwed up their bank account. Go to the bank. Done.

Yeah, police are morons half the time with no knowledge of the actual law they are investigating. Forgive me if I have no respect for a police investigation until the facts come out in an actual court room. You know, where we get to hear both sides of the story and hear a proper explanation of the charges and discovery and motions based on the law, etc etc.

You see the quote from the cop in the OP? After all we have discussed, do you really think that explanation of what happened has any relevancy at all?

 

[RickyJ]

I had a thought about this while I was washing dishes. The rules of evidence make getting a criminal conviction much harder, and the "reasonable doubt" standard doesn't apply in civil court.

If the justice system would not allow the company to pursue the civil matter if the criminal case failed, this could have been a blessing in disguise for that thief.

Which is exactly why the company was dumb to call the police about this. They should have sued him.

 

[newbitech]

Which is exactly why the company was dumb to call the police about this. They should have sued him.

or just gone to the bank and explain their fuck up, like responsible people do.

 

[newbitech]

So here are the possible things that the company could have done.

0.) hire competent people
1.) reverse the direct deposit error within 5 business days (what probably should have happened)
2.) Work with the guy in an employee/employer relations and process automatic payroll deductions to recover the funds (what i think would have been best)
3.) file an erroneous transfer claim at their bank (this could have and still can happen at any point)
4.) Harass the guy and hire a strong arm to collect the money gangster style while accusing the guy of stealing (the preferred method for folks who refuse to take personal responsibility for their own screw ups)

I still think they should have worked it out with the guy in lieu of correcting the error at their bank. I still doubt the company has any kind of strong case as long as they continue to procrastinate and push for criminal prosecution in what seems to be a cut and dry civil case.

Any other options anyone can think of? And how would you characterize those options?

 

[angelatc]

So here are the possible things that the company could have done.

0.) hire competent people

Making a single, isolated typo is not evidence of incompetence. Although your revision to label this as point zero amuses the hell out of me.

1.) reverse the direct deposit error within 5 business days (what probably should have happened)

We don't know that it didn't. We have no reason to think that the guy waited 5 whole days before he appropriated the cash out to open a new bank account, presumably to keep the employer from withdrawing it.

2.) Work with the guy in an employee/employer relations and process automatic payroll deductions to recover the funds (what i think would have been best)

We have seen zero evidence that the guy wants to give any of the money back. And no possible way is this the best solution because the amount of money is so much. So far the company can probably count on getting at least $10,000 back, because they'll put a lien on the bail money he presented.

We know nothing about this guy, except that he has two prior arrests. He may been there for 10 years, or he may have still been on his 90 day probationary period.

The people who actually do know him didn't seem to think that payroll deduct was their best bet. And since they had to go find the guy to talk to him, it's seems pretty logical to assume perhaps he wasn't even interested in being an employee any more.

3.) file an erroneous transfer claim at their bank (this could have and still can happen at any point)

They can't do that after the 5 days have passed. And I don't know why you won't believe me when I tell you that the money is gone. The thief already pulled the money out. Not only are they legally prohibited from pulling the money back out, there is no money to pull back out.

4.) Harass the guy and hire a strong arm to collect the money gangster style while accusing the guy of stealing (the preferred method for folks who refuse to take personal responsibility for their own screw ups)

There are degrees of responsibility. Obviously their internal controls need some tweaking, but revamping them is the extent of their responsibility. Did you read the NACHA documents? They are pretty clear that making a mistake does not entitle anybody to any less protections. You can write your PIN on your ATM card, and you'll still get the money back if a thief grabs it and uses it. And he'll still get charged with theft.

I still think they should have worked it out with the guy in lieu of correcting the error at their bank. I still doubt the company has any kind of strong case as long as they continue to procrastinate and push for criminal prosecution in what seems to be a cut and dry civil case.

You have no proof that they procrastinated. You have no proof that they are "pushing" for a criminal prosecution. If it was not a criminal case, the police would have advised them to take it to civil court.

Its amazing that with your extensive background in financial services that you still seem to think that the money is in the bank, and that a piece of paper can make it appear back into their account. He took the cash out. And I'm sure you already know that the NACHA agreements spell out that the banks are in no way liable for this.

Any other options anyone can think of? And how would you characterize those options?

Turn it over to Corporate Counsel, let them consult with law enforcement, then consent when they advise arresting the guy for grand theft. I think that's the best option, if for no other reason than it at least got them $10,000 back already.

 

[angelatc]

or just gone to the bank and explain their fuck up, like responsible people do.

They don't have to go to the bank. They can reverse a deposit from a PC in their office.

But if they been totally ignorant, and thought they could dispute this using the consumer protection laws, the bank would have said, "Gee! We'd love to help you but the guy already appropriated the money from his account. Good luck finding it! "

 

[angelatc]

Which is exactly why the company was dumb to call the police about this. They should have sued him.

If the criminal case falls apart, they can still sue him.

 

[newbitech]

Making a single, isolated typo is not evidence of incompetence. Although your revision to label this as point zero amuses the hell out of me.




We don't know that it didn't. We have no reason to think that the guy waited 5 whole days before he appropriated the cash out to open a new bank account, presumably to keep the employer from withdrawing it.




We have seen zero evidence that the guy wants to give any of the money back. And no possible way is this the best solution because the amount of money is so much. So far the company can probably count on getting at least $10,000 back, because they'll put a lien on the bail money he presented.

We know nothing about this guy, except that he has two prior arrests. He may been there for 10 years, or he may have still been on his 90 day probationary period.

The people who actually do know him didn't seem to think that payroll deduct was their best bet. And since they had to go find the guy to talk to him, it's seems pretty logical to assume perhaps he wasn't even interested in being an employee any more.



They can't do that after the 5 days have passed. And I don't know why you won't believe me when I tell you that the money is gone. The thief already pulled the money out. Not only are they legally prohibited from pulling the money back out, there is no money to pull back out.


There are degrees of responsibility. Obviously their internal controls need some tweaking, but revamping them is the extent of their responsibility. Did you read the NACHA documents? They are pretty clear that making a mistake does not entitle anybody to any less protections. You can write your PIN on your ATM card, and you'll still get the money back if a thief grabs it and uses it. And he'll still get charged with theft.



You have no proof that they procrastinated. You have no proof that they are "pushing" for a criminal prosecution. If it was not a criminal case, the police would have advised them to take it to civil court.

Its amazing that with your extensive background in financial services that you still seem to think that the money is in the bank, and that a piece of paper can make it appear back into their account. He took the cash out. And I'm sure you already know that the NACHA agreements spell out that the banks are in no way liable for this.



Turn it over to Corporate Counsel, let them consult with law enforcement, then consent when they advise arresting the guy for grand theft. I think that's the best option, if for no other reason than it at least got them $10,000 back already.

NACHA is 5 days to reverse the EFT with the clearing house.
EFTA is no time limit to file an erroneous transaction claim with their financial institute, with the only stipulation being after 60-90 days the claimant begins to assume liability for a portion of the loss up to 100% (if they just wait too long, not sure how that is determined).

So lets make a quick entity relationship diagram.

1.) The Federal and State Labor laws consider overpayments to be an advance on wages.

2.) NACHA has no jurisdiction over liability. Reversal of an erroneous ETF is supported by the AUTOMATED system up to 5 business days after the EFT Settlement.

3.) FDIC/EFTA Regulation E has jurisdiction and liability provisions for erroneous transactions. Reversal of an erroneous EFT is supported in this regulation up to 90 after the EFT Settlement with NO LIABILITY. After 90 days, liability appears to be proportional to the amount of time between 30 days after the regular periodic statement was received and the time it takes for the account holder to notify their bank of an EFTA Regulation E erroneous transaction.

It doesn't matter that the account holder is a company that uses the account for the purpose of payroll. In that case the company is a CONSUMER of financial services from their financial institute. The same exact laws apply for a company using the account for payroll as it does for an individual purchasing adult toys from a sketchy adult website. There is no stipulation regarding the AMOUNT of the transaction other than what is covered by FDIC. Each have 90 days after their last regular bank statement to make a ZERO liability claim of an unauthorized transaction.

The Financial institute is obligate under the law to PROVE that the transactions were authorized AND for the CORRECT AMOUNTS. In the case of an erroneous transaction with evidence supporting that there was in fact an error, the financial institution in compliance with EFTA Regulation E must PROVISIONALLY credit the account within 10 days of the initial claim, and subsequently has 45 days to notify the consumer of their findings. Should the error be confirmed making the transaction unauthorized, the financial institute then has 10 days to credit the entire balance of the transaction back to the consumer's account.

At this point, this means the entire funding process in the chain of banks government by FDIC is REVERSED. So the guys account where the error transaction landed will be debited whatever the error amount was deemed.

At that point, the company could wash their hands of guy and move on. Then, the guy's bank would begin the fraud investigation or whatever to determine if he stole the money from the bank, or if he also simply made a mistake and now owes the bank the balance. He could refuse to pay all day long and not be a criminal, just like people refuse to pay their loans all day long and don't go to jail. They file a civil claim lien his property and get a judgement to garnish his wages.

All that being said, do people scam the system and look for loopholes to rip people off? Yeah, and that is called fraud and should be punished criminally.

That ain't what happened here.