Somebody I know asked to deposit money into my checking account so I could withdraw the money and let the person avoid their ATM fee (we have different banks). I am uncomfortable with doing so. However, I am not sure of the exact reason(s) why this could be bad for me. Are there any?
I know the person a good bit. I do not know their address or the amount of money.
This is dangerous as it is a typical a scam. Trudy convinces Bob to help her avoid an ATM free or some other pretense. She writes Bob a check for $100, but is willing to take only $80 to return the favor. Bob agrees.
Bob deposits the check, gives Trudy the $80 and then later finds out the check is bad. In most cases Bob will not be able to find or contact Trudy.
However, in some rare cases if Trudy feels Bob is very gullible, she will do the same thing again and again as long as Bob allows. Sometimes the amounts will increase to surprisingly high levels.
If it were a friend of mine, I'd do it without having any real qualms about it.
If it were simply "someone I knew", probably not.
Of course, if I trust them them enough to do that, I'd probably just give them the cash and let them pay me back in a day or two.
(I'm imagining a scenario where I'm out with a few friends, for example bar hopping or at an event where most vendors require cash and we're talking an amount less than say $50. Any more than that, and I almost certainly would not agree).
There are at least a couple problems:
Your friend may not manage money well and so may not have enough money in the account. Check bounces. They get charged a fee. You get charged a fee. You have to chase after the friend to get the fee paid. The friend was cheap about the regular fees and doesn't want to pay this much higher fee.
Your "friend" may really be a crook. The check is no good. Perhaps it's written under a false identity such that you are attempting to cash a stolen/forged check. You cash it. They take the money and disappear. You get charged with participating in the crime, go to jail, and now have a criminal record (worst case).
My quick thought is that if you don't know the person well enough to know the home address, you don't know the person well enough to cash checks.
In general, I would view this the same as a loan. When loaning to a friend, you should never loan more than you are willing to lose. Note that an actual loan would be safer. If you loan $50 to a friend, at worst you're out $50. If you deposit a fraudulent check, you did something illegal. You will have to be convincing when you tell your story to the police. If they don't believe you, they could charge you. A couple bad breaks and you could go to jail.
There are lots of reasons why a crook would want you to do this: counterfeit check scam, laundering money, trying to get your account information, getting you used to doing questionable things and then escalating, seeing whether you're the kind of person to go along with bad ideas, etc.
There are not, however, much in the way of good reasons for it. I gather you can withdraw money from your bank without an ATM fee. This I am assuming from the fact that it is being proposed that you withdraw money from your account, and the fact that this is how pretty much all non-predatory banking works. If this person's bank won't let them withdraw money without a fee, something is seriously wrong, and they should get an account at your bank. Do they get charged for using a live teller as well? If not, how is getting money from you easier than getting it from a teller? How much is the fee? If the fee is $2, and you're making $10/hour, that's 12 minutes of wages. Does it take less than 12 minutes to complete this transaction (including the time this other person is spending)? This cartoon comes to mind: https://xkcd.com/951/
I'd like to take a moment to point out: I cannot find a bank that charges customers with a checking account fees for withdrawing from an atm owned by that same bank.
It is a cornerstone of most banks now to encourage online and atm banking.
You should definitely research the validity of the claim that you're associate cannot withdraw from their own account through their own bank's atm without fees.
A second scenario I can think of, is that this person uses a bank that does not operate in your region. Then they cannot find an atm owned by their bank. If this is the case, they should simply go to the bank the check is drawn on, and cash it there. So far I only know of Chase bank charging non-Chase customers to cash a check drawn on a Chase account (this is a crap policy that makes me hate that bank).
**disclaimer - I am not familiar with all banks, but a quick Google search of banks that operate in your region should reveal which ones if any charge their customers for use of their atms. you may or may not find the check cashing charge policy without attempting to cash the check.
