Money for nothing, conviction for free

Money for nothing, conviction for free

Summary: The poor deluded folk who thought they were getting free cash out of the Commonwealth Bank on Tuesday would have woken up with a bad overdraft hangover on Wednesday morning.

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TOPICS: Outage, Banking, Legal
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The poor deluded folk who thought they were getting free cash out of the Commonwealth Bank on Tuesday would have woken up with a bad overdraft hangover on Wednesday morning.

ATM

(ATM image by megawatts86, CC BY-SA 2.0)

Commonwealth Bank's routine database maintenance on Monday night didn't go so routinely, taking down funds transfers for Netbank, BPAY and phone banking amongst others. The bank also reported that it had stopped transactions at some ATMs and EFTPOS machines.

By the afternoon, the New South Wales Police were warning people that taking money "dispensing" from Commonwealth Bank ATMs for free was in fact a crime.

Naturally the police's sternly worded announcement only served to send hundreds of keen punters flocking to Commonwealth ATMs around the country in search for this "free" cash. Twitter was filled with reports of huge queues. Upon investigating myself, each CBA ATM in the vicinity of the ZDNet Australia office had a long line-up, while ANZ, Westpac and St George ATMs were abandoned.

On Wednesday, when the bank's systems were up and running and ATMs were back to normal, the bank began chasing its missing cash. At least two people were arrested for allegedly withdrawing cash that wasn't theirs.

There's certainly collective schadenfreude in the community whenever banks falter. They're the cliche media bad guys in Australia because of their high fees and interest rates. So it seems incomprehensible that so many people would think that the bank wouldn't have the ability to record who exactly was taking all the free cash from each ATM.

One could draw the conclusion that the morning's database maintenance had led to ATMs giving out free money with no record but the reality is much simpler. The bank was faced with a choice: have hundreds of angry customers unable to access cash; or turn the ATMs into offline mode, allowing customers to withdraw cash regardless of their balance while recording each transaction. The latter has less impact on customers and won't cause it to lose too much cash as it will be able to regain money drawn from overdrawn accounts from its own customers, and seek to get funds back from the banks of those who weren't their customers.

It was a simple choice — keep the customer happy.

Most people should have twigged that banks would be keeping a record of those trying to kick the bank while it was down using records, surveillance cameras and other systems.

After all, a similar thing happened in Queensland this week. Queensland Health revealed it was investigating 120 employees who were said to have falsely put their hand up for emergency cash payments during the disastrous failed roll-out of the Queensland Health payroll system in March last year.

In all the chaos at the time, Queensland Health had no method of checking whether an employee had been paid the correct amount and advanced cash to employees who claimed they had been underpaid, relying solely on the honesty of those employees. Now that the department can cross check those claims with the actual payments given out at the time, it has discovered a difference of roughly $662,000. Eight people have already been charged, with one convicted and ordered to pay the money back.

If we can take anything from these two incidents, it's that in this world where every electronic transaction is recorded, there's no such thing as free money.

Topics: Outage, Banking, Legal

About

Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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4 comments
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  • You know when the lines go down you can put any 4 digit pin in and access your account. They don’t record photos then either. This means to charge Tuesdays money grabbers the bank will have to prove that the account holder was the one defrauding them. Many will simply turf the card, report it missing and lodge complaints about their overdrawn accounts. Which bank? That one
    factoid-8b10a
    • I'm not sure you really understand how these systems work factiod. The entire system wasn't down. In order to use your card the correct PIN is actually required. The surveillance cameras are not really necessary when you have withdrawn money from your own account using your card and your PIN.
      stu5
      • Stu5. Commbank goes offline and you can enter any 4 to 6 digit pin and the next screen will be cheque savings credit. It's simple. Your pin is not stored on your card otherwise 'skimmers' wouldn't need to video you enter your pin! Its stored at HQ, same place your ballance is. When you swipe that plastic you tell the machine to fetch, problem on Tuesday, machines couldn't fetch anything. What they did do however was allow people to withdraw cash while not knowing the ballance, store the account/card number and cash dispensed. When the lines went back up the ATMs sent that data back to HQ. That's every machine will let you get your daily limit and does not require your correct access pin when lines go down.
        factoid-8b10a
  • The skeleton system that allowed people to do that on Tuesday is the same system that lets you access your cash when the lines are down. It's basically a digital click clack and sign your name without signing your name.
    factoid-8b10a