Deposit Dangers - Mobile Banking Can Cost You Money

More people are using their smartphones to make bank deposits. However, there are problems that can happen with mobile banking. It turns out there's a kink in the system where the check might get deposited twice. Credit expert Gerri Detweiler is careful with her money. So, she was surprised to get a phone call saying that a check she wrote to charity was cashed twice. "My first reaction was, 'How did this happen?' my second reaction was, 'Oh no, have I bounced any checks?" says Detweiler. The problem started when the charity deposited the check virtually, by simply pointing, shooting and clicking using a mobile banking app. Then an employee from the charity went to the bank and deposited the exact same check, number 1027, again. The bank didn't catch the mistake and Detweiler's account was debited twice. "I think most people would be shocked to learn that a check that they write could be deposited twice," adds Detweiler. However, there are other ways a check can be deposited twice. "It could be somebody deposits the same check by mobile banking into two different bank accounts at two different banks," says Nessa Feddis from the American Bankers Association, "It can also be that they've deposited remotely using their mobile app and then go to a store to cash it." The 'American Bankers Association' says double deposits are rare because banks have detection systems. "Generally if there is a duplicate deposit the check writer's bank will catch it, and the check writer never knows anything about it," adds Feddis. If your bank doesn't catch a "double debit" it will refund your money. You can protect your account by having your bank alert you if your balance goes below a certain amount, ask your bank what they do about double deposits and check your account every day. "Look at your balances, look at your transactions and communications to the bank or the credit union," says banking and check processing expert Betsy Didan, "If you see some suspicious activity or transactions you know you didn't make." If you accidentally double deposit a check you won't get in trouble if it's a genuine error. However, the money from the second deposit will be taken out of your account. "They will be watching very carefully on the back end. If they have any abuse to the system, they will actually shut down the application if they feel the consumer does not handle it appropriately," adds Didan. In Detweiler's case everything worked out. The charity reimbursed her and now she encourages people to keep a close eye on their bank accounts. "I've learned a lesson here," says Detweiler. If someone is double depositing on purpose then they are committing fraud and they can get into legal trouble. There are things you can do to prevent double deposits. After you make a mobile bank deposit mark the check in some way so you know it's already been deposited.