This 10-year-old Arizona girl sold her prize chickens for $2,100 — then Chase froze her check, closed her bank account, and told her she’s ‘not going to get her money back.’ Here’s why

Why would Chase freeze an account?

Kinley’s mom spent several hours on the phone with Chase, trying to figure out what happened to the girl’s prize money and why her account had been closed. According to Kalli, Chase said when bank officials checked the phone number of the Small Stock Association, which issued the payment, it was out of service. That seemed suspicious to them, so they froze the funds and closed her account.

“[Chase’s] ultimate response is that, sorry, Kinley is not going to get her money back,” J.R. told reporters. “And there’s nothing we can do unless we can verify that check.”

So, the man from the Small Stock Association who wrote the check went to Chase to verify it in person. According to the Maners, he went in three different times in an attempt to verify the check, but Chase said he could only verify it by phone.

Chase's actions in freezing Kinley's check and closing Kali's account align with standard bank practices for risk management and fraud prevention, especially under KYC (know your customer) and AML (anti-money laundering) regulations. When banks encounter checks from unfamiliar sources or suspect fraud, they may flag the transaction. Freezing funds and closing accounts is a protective measure used to prevent fraud or money laundering.

However, in this situation, Chase refused to accept the issuing person's in-person verification, possibly due to policies that require verification to occur on channels they can document, such as the phone. While these steps aim to protect the bank from regulatory challenges and fraud, they can create issues when applied without consideration for unique situations, such as a child depositing a large sum.

Online, several customers report issues with Chase closing accounts without recourse. A year after the fair, Kinley still hadn't received her funds — until they called Arizona's Family On Your Side.

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What to do if it happens to you

Just a few hours after the On Your Side team contacted Chase, the bank reached out to Kinley's family and apologized. The bank overnighted a $2,100 check to Kinley, who then put most of the money in her college fund.

If you're facing issues with frozen funds or a closed account, there are several avenues for resolution. Start with the bank's customer service department. Ask for a clear explanation and for the next steps. Sometimes, providing documentation can help lift the freeze. If the initial conversation doesn't resolve the issue, ask to speak to a supervisor or Tier 2 representative.

Another resource is the Consumer Financial Protection Bureau (CFPB). This organization oversees and addresses consumer complaints in the financial sector. Financial institutions are expected to reply to CFPB complaints quickly, often in 15 days or less.

Finally, research the banking regulator department in your state. In Arizona, residents can contact the Arizona Department of Insurance & Financial Institutions. If you feel your bank's steps were unjust, filing a complaint may help resolve the issue.