LIMA — An attorney is being sued because he deposited a fraudulent check for $297,500 and transferred nearly all the money to a bank account in Japan. He says he is the victim of fraud.
But the Union Bank of Columbus Grove sees it differently.
Union Bank filed a lawsuit in Allen County Common Pleas Court against F. Stephen Chamberlain and J.P. Morgan Chase Bank, seeking the money back. Union also wants attorney fees and interest.
The lawsuit said Chamberlain is responsible for any money he deposits. Chase Bank officials told Union Bank officials the check was good. Chase is negligent for not having enough safeguards in place to catch fraudulent checks, the lawsuit said.
Chamberlain said he did nothing wrong, is a victim himself and plans to sue Chase, which told him and Union Bank the check was good. He said he never would have wired the funds if the check was not good.
Chamberlain, who is a public defender, declined to identify the client he said hired him to handle the check. He said the client is from overseas.
“My client was using me and my bank account to commit fraud,” he said.
Chamberlain said he has notified the FBI, which is investigating the matter.
“I don’t know if anything can come of it,” he said.
A spokeswoman for Chase’s corporate office in Columbus said the bank typically does not comment on pending legal matters.
During the process, Chamberlain’s client also gave him a $498,500 check Chamberlain said he wasn’t about to deposit and transfer.
“This is a fraud scheme, and now we’re left holding the bag — the banks and myself — trying to work out where we’re going to make up this loss,” Chamberlain said.
Chain of events
In the lawsuit, Union Bank said Chamberlain brought in a cashier’s check drawn on a Chase Bank account for $297,500 on Oct. 24. Chamberlain asked to deposit it into his lawyer's trust account.
The next day, Chamberlain visited a Union Bank location asking to wire $294,400 to a bank in Japan. The teller told the branch manager, who contacted Chase Bank to confirm money was in the account, the check was valid and there was no holding order on it.
On Oct. 29, the Union Bank manager received a call from Union Bank's bookkeeping department saying a fax from the Federal Reserve of Cleveland notified the bank the check would be returned.
The manager contacted Chamberlain and both contacted Chase. After receiving conflicting information, they realized the check was fraudulent.
Chamberlain received another check from his client and went to the Union Bank on Oct. 30 with a check for $498,500. The Union Bank manager contacted Chase.
According to the lawsuit, a representative of Chase told the manager the remitter of the two checks, Young Investment Group, at one time had an account with Chase, but it was closed due to fraudulent activity.
Union Bank officials told Chamberlain and Chase that Union Bank wanted the money owed. The bank is suing Chamberlain for his actions and Chase bank for saying the check was good when it was not.