Could I Deposit a Check Again
Business owners Stefan Marten and Pearl Scott-Marten say they had to fight to become coin back from their credit union afterward several of the couple'south employees cashed their paycheques twice using increasingly pop cyberbanking apps that allow cheques to be deposited with a photo.
In the Martens' case, the double deposits — known in the industry as double presentment — happened 17 times. They were tipped off by an employee who accidentally deposited the aforementioned cheque twice. When they reviewed their depository financial institution records, they constitute the other double deposits, leaving them with thousands of dollars in actress payments.
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"It'due south been frustrating and nervus-racking," said Scott-Marten, who with her husband owns Marten Brewing Co. in Vernon, B.C.
"When we were edifice the pub and the restaurant and the brewery, nosotros were wearing a lot of hats and not having a full-time bookkeeper. We had to keep an centre on our accounts at the same time as doing everything else. The i thing I didn't await that could happen was having cheques that would be cashed twice."
Until recently, all cheques being deposited (whether through a banking machine or in person with a teller) had to exist handed over to the financial establishment. That changed a few years ago with the introduction of mobile banking apps that permit customers to deposit cheques by taking a photograph with their smartphones. That image is then transmitted electronically to their financial establishment. Information technology's called remote deposit capture.
"As far as I knew, cheques take always been… you bring them into the bank, they become stamped, the teller takes the cheque, and that cheque is no longer floating around.
"Right now, at this phase in technology, we have cheques that are being cashed by the telephone, they're not being received by the bank, they're non being destroyed or given dorsum to the person who wrote the check," said Scott-Marten.
Half exchanged every bit images
The use of these apps is on the rise, so are the risks to those who write cheques, co-ordinate to banking security expert Chester Wisniewski.
According to Payments Canada, the government agency that'due south responsible for setting the rules effectually financial transactions, 800 million cheques were written last year, and half of those were exchanged as images (this includes photograph deposits and cheque exchanges betwixt banks). The agency says that number is growing quickly.
'Well, nosotros're kind of using 19th-century applied science colliding with our smartphones, and information technology's just complicated.'- Security expert Chester Wisniewski - Security expert Chester Wisniewski
"Our worst one was a stale-dated cheque … over eight months one-time that was cleared a second time. So there'due south a cheque that was deposited one month, and eight months subsequently deposited again," Marten said.
He said that when he brought the trouble to the attention of Valley First, his credit spousal relationship, information technology initially told him it was his fault considering he failed to notify the fiscal establishment within the 60 days customers have to flag problems with their accounts. He and his wife have since been reimbursed.
The credit union wouldn't comment on why it failed to flag the double deposits in the Marten case, citing customer confidentiality.
But in an electronic mail to Become Public, spokesperson David Kropp said the credit union does "accept measures in place to ensure the remote check deposit service is as secure equally possible and they can identify and stop duplicate transactions."
He added: "These mechanisms exist at the institution where a cheque is deposited and where the funds are drawn," and that the credit union works with its members to "identify the source of unexpected transactions and to verify their legitimacy."
Kropp encouraged customers to go on a shut eye on their banking company accounts.
Quondam banking, new technology
The apps themselves aren't the trouble, according to banking security expert Wisniewski, a research scientist at the cyber security visitor Sophos. Instead, the issue is quondam banking methods that aren't working well with new technologies.
"Well, we're kind of using 19th-century technology colliding with our smartphones, and it's merely complicated," he said.
He said double presentment is most difficult to grab when the same check is deposited once using the app and once again using the concrete cheque through an ATM or with a teller.
"By doing one electronic and ane newspaper, that can throw their systems off and brand information technology much more than difficult to detect, or doing it at multiple fiscal institutions tin also intermission those detection algorithms. So that'due south usually what we're seeing when it's successful," said Wisniewski.
In his experience, most double deposits are caught by the person who wrote the bank check — adding most cases are accidental.
"In the cease, banks are but like insurance companies: it's all about managing chance, and if the risk increases for them or it's costing them a lot of money, they'll be more aggressive about preventing it. But at the moment... if you lot don't notice it, often you cease up only paying."
His advice is don't rely on the banks' systems to detect information technology, because "they're not being terribly ambitious almost it." And end using paper cheques. Instead, use e-mail for directly transfers even for pocket-size amounts.
Get Public asked Canada'southward five big banks what measures are in place to detect double presentment. TD, Scotiabank, and CIBC say they have systems that flag double deposits. CIBC for instance, says information technology has built-in technology that won't allow the aforementioned bank check to exist uploaded twice using its app.
RBC declined to comment. The Bank of Montreal didn't answer to our inquiries.
Shared responsibleness
Payments Canada changed the rules around cheques in 2013 to allow digital images to be used in deposits. The alter immune financial institutions to offer remote-deposit capture apps.
The system tells CBC News there are no regulations on how banks detect and deal with double presentment, just manufacture guidelines. It says the level of duplicate detection financial institutions implement is upward to private banks.
Janet Lalonde, who is i of of the directors on the modernization team at Payments Canada in charge of updating Canada'south payments system, says catching double presentment is a shared responsibility.
"[The financial institution] that'southward collecting that cheque on eolith has some responsibleness to make sure their customers are not making mistakes or, you know, behaving badly …. Also the payor'southward bank has a responsibility as well to safeguard the account of its customers."
Lalonde says that under Payments Canada clearing rules, the cheque writer'south bank has 90 days to identify and return a problem cheque and can return it to contrary the deposit.
Individual banks requite customers between 30-60 days to flag problems with their accounts.
She advises banking concern customers to check their accounts oft, to make sure they don't stop upwards paying double for cheques they have written.
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Source: https://www.cbc.ca/news/business/duplicate-deposits-mobile-chequing-banks-1.4584304
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