[JohnGB]

> Normally, cases of fraud or mistakes could be rectified or reverted by the bank or similar institutions after a review of the situation by humans.

This "could" happen, but in practice it rarely happens because the money has moved on as soon as it hits the account. Additionally, for many types of fraud, there has to be an actual court order to get a bank to take action. So the argument is predicated on a false assumption.

[the_mitsuhiko]

I cannot judge the American banking situation but I can attest to the fact that transactions are reverted constantly in Europe. The reason for this is the SEPA direct debit system where debitors can directly charge an account via SEPA direct debit and fraud does happen. For that reason banks are very happy to reverse the transaction and it's not at all a unique situation.

[jiveturkey]

Actually reversals frequently happen. For example, a multi day delay is built into ACH, partly for this exact reason. Also, with credit cards and some flavors of bank transactions you as the end user are protected against fraud, even if (yes)the money has already moved on, you are made whole. The loss is absorbed by the bank. By absorbed, of course I mean you've paid for that service with various fees which amount to a kind of insurance. (Nothing really comes "for free".)

But yes, there are plenty of other types of transactions, like gift card scams, that you would not be made whole for.

[Grustaf]

I guess it differs by geography, but here in Sweden, when I accidentally transferred €10k to an old account that didn't exist anymore I wasn't the least bit concerned that the money would get lost. I would have been extremely surprised if they hadn't given me the money back.

That's the advantage of a high trust society. Heck, once an ATM retracted my cash because I wasn't quick enough, I called the bank and they just credited my account with the €300 or whatever it was. No questions asked.

[knorker]

Do you have a source for that?

In my experience transfers are pretty much always successfully reversed.

Hell, when one of the PirateBay founders hacked a bank and tried to rob it they actually reversed/prevented most of that, even though he had full access to the bank mainframe. He only managed to extract a couple of thousand that his accomplices took out of an ATM, IIRC.