A 33 year old real estate agent and investor with over $120M in residential real estate sales. This is my way of sharing actionable ideas that will make you a smarter and wealthier investor.
The Chase Bank Infinite Money Glitch
Published 3 months ago • 6 min read
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Here’s a scary chart. It’s the US Federal Reserve's assets and liabilities, which have been graphed every year for the past few decades. It shows how the US Government borrows money it doesn’t have.
Source: Board of Governors of the Federal Reserve System
If they need more funds for, say, an infrastructure bill or anything else, they can issue bonds to the US Federal Reserve, which will then transfer these funds to the US Government to be issued into circulation. This is formally called quantitative easing and is essentially an infinite money glitch.
While the US Government does this regularly (and it is perfectly legal for them to do so), there have been instances in history where ordinary citizens can exploit infinite money glitches and reap the rewards for a rather short period of time. The latest of such events is the Chase Bank ATM Glitch.
The Chase Bank Infinite Money Glitch: Why This Viral Trend Is a Bad Idea
Recently, there has been an explosion on Twitter and TikTok about what people call the "Chase Bank Infinite Money Glitch." Some individuals reportedly managed to cash out tens of thousands of dollars — for free! But here’s the catch: it’s completely illegal. This so-called glitch is not a loophole; it’s fraud.
Source: New York Post
Over the last few days, this trend has caught the attention of dozens of news outlets and Chase Bank itself, which issued warnings about the consequences for those who exploited this error. This is not free money, and there are severe repercussions for anyone who tries to game the system, especially when it involves the biggest bank in the United States.
If you're curious about why this was so dangerous, here's everything you need to know. Remember: This is purely for educational purposes, and I'm covering it as an example of what not to do.
How Banks Work
At the heart of this entire situation is a simple banking concept: checking accounts. When you write or deposit a check into your account, it’s an IOU between you and the financial institution. The bank doesn’t instantly know if the check is valid, so there’s usually a delay to ensure the funds are there.
The check itself has no intrinsic monetary value — it’s not like you can write yourself a $100,000 check and claim it's worth that amount. The bank has to confirm that the amount written can be transferred. So, when you deposit a check, banks make a portion of the funds available within 1-5 business days while they verify everything behind the scenes.
In the U.S., Federal law requires that the first $225 of a check deposit must be available for use by the next business day. The rest is subject to verification, where banks make sure you're not depositing non-existent money. This is where the system's checks and balances come into play, ensuring everything is legitimate.
Why Checks Can Bounce
Most banks don’t know if a check will clear or not the moment you deposit it. However, at the end of each business day, all transactions are organized in order of priority, usually from highest to lowest dollar amount. Cash withdrawals might be processed first, followed by debit card transactions, wire transfers, etc.
This prioritization means that while a check deposit might initially seem fine, the account tied to that check could later become overdrawn. For example, if the person who issued the check spends money from their account after you deposit the check and does not maintain their balance, it might bounce a few weeks later. The same can happen if there's a fraudulent claim or if the signature looks suspicious.
There’s a gray area where banks might give you temporary access to funds before they confirm everything is in order. In 99% of cases, this is not an issue, but in the case of this Chase glitch, everything went wrong.
What Exactly Happened During The Chase Bank Glitch
Normally, when you deposit a check, there’s a waiting period of 1-5 business days before you can withdraw the full amount. But one person discovered that, at a Chase Bank ATM, they could access the full amount immediately after depositing a check — no waiting period.
This glitch was a mistake on Chase's part, but instead of keeping quiet, the person posted about it on TikTok. Within hours, people started writing checks for a large amount (which they likely didn’t have), depositing them, and instantly cashing out the full amount. They dubbed it the Chase Bank Infinite Money Glitch and encouraged others to do the same.
Make no mistake: This is check fraud. Writing bad checks knowingly is illegal, and it’s even worse when you do it against your own account. These individuals were effectively committing a felony against themselves by writing checks, depositing fake money into their own accounts, and withdrawing the funds.
The Consequences of Fraud
It’s easy to think people would automatically know this is illegal, but many went ahead and tried it anyway. What happened next? People started posting about the huge sums of money they now owe back to the bank.
Predictably, once Chase fixed the glitch, many users found themselves with an overdraft, some as large as tens of thousands of dollars. There’s no scenario where Chase lets people keep this money. Wire fraud is a serious crime, and committing it against a financial institution, like a bank, increases the potential sentence to 30 years and fines of up to $1 million!
Chase Bank issued a statement saying, "We are aware of this incident, and it has been addressed. Regardless of what you see online, depositing a fraudulent check and withdrawing the funds from your account is fraud, plain and simple." Chase has since combed through its system, locking accounts, marking transactions as pending deductions, and leaving people with negative balances.
Other Infinite Money Glitches
This isn’t the first time something like this has happened. In fact, there was a similar incident last year with CashApp. Users discovered that they could add unlimited funds to their CashApp balance without pulling money from their bank accounts. Although they couldn’t withdraw the funds, they were able to make payments to online retailers. One person reported spending as much as $40,000 before CashApp reconciled the accounts and demanded a repayment. According to their terms of service, CashApp can pull funds from your linked accounts and even take legal action to recover money owed.
Another example is the infamous Robinhood glitch of 2019. A user on r/WallStreetBets exploited Robinhood’s system to borrow an “infinite” amount of money by purchasing call options, selling them, and then borrowing against the purchase multiple times. He turned $3,000 into a $1.7 million portfolio within a day. And just like other glitches, this one ended poorly once Robinhood caught on and sought to recover the funds.
What to Expect Moving Forward
As for the Chase Bank glitch, they will likely use every legal avenue available to recover the money. If the funds are not returned within a certain timeframe, they could seize assets, file lawsuits, and pursue criminal charges.
Chase WILL NOT let this slide. Banks take measures to ensure these types of exploits don’t happen without consequence. If they did, what would stop people from attempting other forms of fraud?
This also explains why banks take your transaction history into account when determining your withdrawal limits. Long-time customers with significant account balances are often allowed to deposit large checks with fewer restrictions. New customers with smaller balances are typically made to wait longer before accessing large deposits.
Conclusion
At the end of the day, this “Chase Bank Infinite Money Glitch” is just a fancy term for check fraud, something that has been around for decades. The only difference here is that the glitch allowed withdrawals to happen faster than the bank could confirm the deposit. Now that the exploit has been fixed, the accounts are being reconciled, and those who took part will be held accountable.
There’s no such thing as free money. If you owe the bank money, you’re going to have to pay it back. Eventually, these glitches get caught, accounts are corrected, and legal action can follow.
That's it for this week. I hope you enjoyed this article. Let me know your thoughts by responding to this email - I read every single comment :)
Stay safe, stay invested and I will see you next week – Graham Stephan.
A 33 year old real estate agent and investor with over $120M in residential real estate sales. This is my way of sharing actionable ideas that will make you a smarter and wealthier investor.