Was the bank customer who withdrew $2 million he didn’t have guilty of a crime? Which case won?
Error by staff member creates vulnerability in bank’s systems
In March 2010 a 22-year-old customer of St George Bank opened a new account at the bank’s Goulburn branch. The new account was marketed – all too aptly, as it turned out – as a “Complete Freedom” account and was essentially a savings account with no overdraft facility.
However, the staff member who opened the account wrongly marked it as having a “relationship officer” assigned to it. The role of the bank’s relationship officers was to approve or disallow withdrawals beyond the available credit limit of the accounts for which they were responsible.
The bank did not normally assign relationship officers to retail accounts such as the Complete Freedom account. The absence of a relationship officer meant that the customer was able to withdraw money which he did not have.
Customer becomes aware of glitch and withdraws increasingly large sums
The customer became aware of this glitch in the bank’s systems some months after opening the account and proceeded to withdraw increasingly large sums via electronic transfers, cash withdrawals and direct debit facilities until August 2012, when the bank finally discovered the extent of his indebtedness.
By this point the account was overdrawn by $2.18 million, which included a substantial sum for interest that the bank had charged on the withdrawals that the bank itself had permitted.
By the time the man was arrested, he had spent the withdrawn funds buying an Aston Martin, a Maserati, a Hyundai, an Alfa Romeo and a 6.1 metre boat, as well as paintings, jewellery and memorabilia.
The man was charged with dishonestly obtaining a benefit by deception and dealing with the proceeds of crime. He pleaded not guilty and so it was up to the court to decide his innocence or guilt.