No Recovery for Bank Burned By ‘Fumiko Bandit’ Scam

CHICAGO (CN) – A bank cannot recover $487,000 lost in a check sent to a family-law attorney who unwittingly aided thieves in an online scam, the Seventh Circuit ruled Tuesday.

The scheme began with an email to David Goodson, a family attorney practicing in Illinois, from a purported new client named Fumiko Anderson seeking representation in a divorce action.

Soon after, Anderson said that her husband was convinced to settle due to her decision to retain an attorney.

Goodson received two checks in the mail from Canada in the amount of $86,178.96 and $486,750.33. Both checks were drawn by First Aid Corporation on its account at First American Bank.

The attorney deposited the checks, keeping a portion of the money for his fee, then immediately wired the rest of the money to his client’s Japanese bank account, pursuant to her request.

However, the larger check was counterfeit. This sort of scheme is an internet scam called the “Fumiko Bandit” scam, according to court records.

“So First Aid had lost the entire $486,750.33 that had been transferred out of its account by the fraudulent check; the money had been stolen by Fumiko Bandit,” the Seventh Circuit’s Tuesday ruling states.

First American sued the Federal Reserve Bank of Atlanta, RBS Citizens and Goodwin in 2014. It claimed Goodson’s actions were negligent given the “highly unusual and suspicious” nature of his client’s request.

“Goodson personally received the checks in packages sent from Canada, even though the checks were purportedly drawn by an Illinois corporation,” the complaint states. “Furthermore, upon information and belief, Goodson caused the funds to be wired to Japan immediately, before First American had paid the checks.”

Goodson’s bank RBS Citizens indemnified First American for the first check, but refused to do so for the second, larger check.

The Seventh Circuit ruled Tuesday that First American cannot demand Goodson or the banks involved in the wire transfer reimburse it for the lost funds.

“The lawyer and the two banks reasonably believed that they were engaged in the innocent, commonplace banking activity of forwarding a check to its intended final recipient on behalf of their clients,” Judge Richard Posner said, writing for the three-judge panel. “There is no claim or evidence that they knew they were siphoning money to criminals. Nor did they fall below ‘reasonable commercial standards of fair dealing.’”

And while Goodson may have received the check under unusual circumstances, he owed no professional duty of care to First American, who was not his client, the ruling states.