Bank clients awarded refund over false money

A court yesterday ordered Bank of Valletta to refund over Lm15,000 to a company in a case involving counterfeit money.

La Piazza Ltd had filed a writ in which it claimed that in October 1997 two of its representatives, Jesmond Mangion and Carmel Cassar, had gone to the bank's Qormi branch in order to ascertain whether a number of US $100 bills were authentic.

The two men had then exchanged the US$40,200 for the equivalent in Maltese liri.

However, the bank subsequently told plaintiff company that the hundred dollar notes were false.

The bank had then proceeded to debit the company's overdraft account with the sum of Lm15,264.52.

The company claimed that as a result of the bank's actions it was now in a position where it could not recoup payments made in favour of third parties for the dollar bills, and that it had accepted the bills after the bank had confirmed their authenticity.

The court was requested to order the bank to refund the sum of Lm15,264. 52 to La Piazza Ltd.

Mr Justice Geoffrey Valenzia, in the First Hall of the Civil Court, pointed out that the company had received 402 bills of $100 each from a foreigner whom they did not know.

They took the bills to the bank and asked the bank to verify their authenticity.

The company had only decided to accept the dollar bills after the bank's confirmation was obtained, and they had then converted the dollars to Maltese liri.

However, two days later, plaintiff company was informed by the bank that it resulted, from further tests that were carried out, that the dollars were counterfeit.

The company was requested to return the monies to the bank.

On that very same day, the bank debited the company's account in order to recoup the money.

In its judgment the court noted that the bank had checked the dollars under an ultra violet lamp and had confirmed their authenticity, and that it had converted the dollars to Maltese liri.

At no stage of these proceedings was plaintiff company informed that this test was only on a prima facie basis.

The bank, said the court, had not observed its own procedures and had cashed the dollars immediately.

The court therefore upheld the company's writ.