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November 26, 2012

Bank Customer Awarded Over $90K When Court Finds Bank Complicit in Plaintiff Filing Claim Late - Boston Criminal Defense Attorneys Parker Scheer

In 2006, Sharon Mullen discovered that a repairman had stolen, and then forged, some of her personal checks. When Mullen informed her bank, RBS Citizens, the bank manager had Mullen fill out paperwork regarding the forgery which they both signed. The bank manager then told Mullen if she wanted the bank to reimburse her she would have to report the forgery to the police. However, the manager did agree not to process any claim until Mullen gave the repairman the opportunity to return her money without police involvement. Later, the bank manager spoke to the bank's corporate fraud and security department about the forgeries.

Over the next two months Mullen kept the bank manager informed of her progress in collecting her money from the repairman. The bank manager even gave Mullen advice regarding whether it was okay to continue waiting on the repairman. Ten weeks after she reported the theft to the bank, the repairman had not given Mullen any money so she filed a police report and signed an affidavit against RBS for the fraud perpetrated on her checking account. Three weeks later, RBS denied Mullen's claim on the ground that the statute of limitations to make a bank claim for forgery was 30 days. Though the bank manager then attempted to help Mullen's forgery claim get approval, she was denied again upon review. Mullen filed suit against the bank for improper payment of forged checks, breach of contract and violation of Chapter 93A.

While the district court judge granted summary judgment to the bank on the plaintiff's 93A claim, at trial the district court held for Mullen and ordered the bank to pay her $17 thousand, which the bank paid. Mullen then appealed the summary judgment decision on the Chapter 93A claim. The appellate court reversed. In a new trial, the district court judge found that the bank's "failure to clearly disclose its procedures for [the] claim was willful, knowing and calculated to mislead." Appellate Division affirmed.

Mullen was awarded treble damages, plus costs and attorneys' fees for both the first and second trial. The Appellate Division awarded fees and costs for the appeal.

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