Card transactions by proxy

Peter Mitchell otcbn at
Wed Apr 6 14:01:07 BST 2011

Charles Lindsey wrote  on 6-04-11 12:47:
> On Tue, 05 Apr 2011 15:36:17 +0100, Peter Mitchell <otcbn at> 
> wrote:
>> Cheques or SOs cannot be set up without your signature or a similar 
>> means of authorisation. If they are, you can repudiate them relatively 
>> easily, although - as with all frauds - the accountholder will suffer 
>> inconvenience until it is resolved.
> Yes they can because, as I was surprised to discover, the piece of paper 
> with your signature is never shown to the bank. The Setter-up just 
> informs the bank that they have the authority, and it happens.

You mean DDs can be set up that way. Yes, that's the point I 
am making.

The supplier is much less likely to do something similar 
with cheques or SOs. Partly because they would (usually) 
first have to get hold of a physical object such as a 
chequebook or bank card belonging to the customer, and then 
impersonate him, which is difficult; and partly because that 
would be committing a serious criminal offence, whereas with 
DD they can just do it and nobody will do a damned thing, 
least of all the police.

> This happened to my wife. They knew the bank details because they needed 
> to pay dividends to her. But they also set up a DD facility (though they 
> had no signed authority) even though no payments from my wife would 
> arise. Two years later, they raised a DD which the Bank paid (but 
> immediately unscrambled when asked). But I doubt that "they" could have 
> produced the signed paper after two years, even if it had existed.

Yes - that's pretty much the scenario I am complaining 
about, except that banks very often do *not* reverse the 
payment when asked. A quick google will show many examples e.g.

It may be that banks are beginning to perform a bit better 
on this front, as Ian claims. But if so - and I would like 
to see evidence - by God it's taken a long time and a lot of 
arse-kicking by consumers to get them to behave themselves. 
The regulators, of course, have been next to useless.

Pete Mitchell

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