WINTER PARK, Fla. – A Winter Park man said his bank refused to issue more than $3,700 stolen from his business account because he did not report the fraudulent ACH, or Automated Clearing House entry, within the mandated 24-hour timeframe.
Mike Mitchell of M&M Building Enterprises LLC, a small home rental company, told News 6 that Wells Fargo’s Enterprise Complaints Office closed his case on May 3, 2023, because it found no evidence of fraud.
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This week it appears the case has been closed again with no resolution.
“If you don’t notify somebody by 3 o’clock — bye-bye money,” Mitchell said.
The standard of reporting ACH fraud — set by the National Automated Clearing House Association, NACCHA — states a business transaction has a dispute right of 24 hours and 3 p.m. central time.
In this case, Mitchell missed the 24-hour deadline to report the ACH fraud by 2 hours and 34 minutes.
Wells Fargo reopened the investigation after News 6 launched an independent review of Mitchell’s bank records that showed an overdraft in the account after more than $3,700 was transferred to a parking fee company called Pay-By-Phone.
When News 6 asked Mitchell what authorization was needed to transfer funds from the account he responded: “Apparently none because I didn’t authorize this transaction.”
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Since that statement Mitchell said it was all starting to make sense, claiming it appears his information was stolen.
In an email to News 6 on Friday, Oct.27, Mitchell said a Wells Fargo representative based in Iowa, contacted him and confirmed “Somehow the ‘Merchant,’ Credit Card Payment, received our account information (bank number and routing number is all that is needed) and initiated the ACH transaction for $3,771.99. "
According to Mitchell, the bank representative said “Wells Fargo requested the funds be returned from the ‘Originating Bank,’ Certegy Card Services, but the Originating Bank refused to return the money.”
Mitchell said the bank did not think he authorized the transaction.
News 6 found the company website for Certegy promises “To reduce fraud through our proprietary data science and risk analytics tools.”
Mitchell said he never had an account with Certegy or Pay-BY-Phone and does not understand how someone was able to access his personal bank number and account.
Since the incident occurred Mitchell closed all seven of his Wells Fargo accounts to avoid additional losses.
A Wells Fargo spokesperson told News 6 there is no evidence that the account was hacked or compromised in any way.
“There was no unauthorized account access related to this payment. The merchant’s bank originated this ACH transaction and we (Wells Fargo) provided the information to our customer to resolve the payment dispute with the merchant and merchant’s bank,” Wells Fargo said.
Wells Fargo has never explained how Mitchell’s bank information was compromised and because of privacy protocol cannot reveal the account that received his money.
A source familiar with bank account protocol told News 6 that the funds should have been reversed but that the merchant bank cannot give out information on an account even if it received funds fraudulently.
U.S. Secret Service Special Agent-in-Charge Caroline O’Brien-Buster told News 6 that fraudulent ACH transfers are almost commonplace and that account holders need to monitor their bank accounts daily.
“It’s not a matter of is it going to happen, it’s when is it going to happen. So you have to be your own advocate,” O’Brien-Buster said.
Obrien-Buster stressed that any account holder, business or consumer, should check their accounts daily.
“Somebody didn’t go into a bank and do this,” Obrien Buster said. “It was all online, I can guarantee that.”
If you have a consumer or banking issue email makeendsmeet@wkmg.com or mholfeld@wkmg.com
Or text the words make ends meet along with your contact information and issue to 407-676-7428
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