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Suspected Fraud- Funds from ACH Credit on Hold

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We suspect a customer is being used as a mule and recently received a large ACH credit. The next day, he wanted to send an international wire with the proceeds from the credit. His explanation of where the funds came from and what they are being used for has changed several times; therefore, we froze the account and have the funds from the ACH credit on hold. Since we suspect he received the funds fraudulently, are we under any obligation to release these to our customer?

Without a court order, you are on thin ice if the borrower demands the funds. You don't have a legal excuse for denying him the funds.

First published on 09/08/2019

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