An article
caught my attention and got me laughing. A woman in the suburbs of New Orleans
went online to check her Charles Schwab stock brokerage account. She found that
it had magically grown by over $1,200,000 US. She went out on a fast and a wild
spending spree. She bought a new house, a new car, etc.
Charles Schwab caught up to her. They
told her that they had deposited the large sum into her account by error. They
demanded the return of the money. She could not return it all. The Jefferson
Parish Sheriff's Department has changed her with bank fraud and grand theft.
In the US legal system such an erroneous
deposit of funds to an account is deemed to be a criminal offense. After all,
you knew that the money was not yours. In a country with a British Common Law
legal system views such matters differently. Such an error is deemed to be
negligence on the part of the financial institution. A civil suit is filed to
recover the funds.
This story takes me back to January of
1988. I was living in L.A. at the time. I was drowsy when I awakened one
morning. I opened my mail from the previous day. One letter was from my money
market fund Capital Preservation Fund. I looked at my statement. I normally
kept $1,000 US in the account. I was shocked to see a balance of $310,000 US. I
asked my domestic partner Antonieta to confirm this balance. She confirmed it.
At that time, I was working as a paralegal
at a personal injury law firm. When I arrived at work, I went right into the
senior partner's office. I showed him the statement. He laughed long and hard.
When he regained his composure, he gave me the following advice:
"Jack, if you take any of this money,
you will go to jail. On the other hand, any interest earned while the money
sits in the account is yours."
It took several months for the
financial institution to discover the error and remove the funds. I made a tidy
amount of money off the interest. The financial institution praised my honesty.
The grandson of the founder became a friend of mine.
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