Bank Transfers - Odd Question..

Bephlam

Hi,

This is an odd one...but would appreciate feedback from the boards.

My friend recently transferred £250 in to my account (RBS) from her current account (Barclays); however it later transpired that the bank made an error and sent £500 instead of the agreed £250. My friend disputed this with the bank immediately - they admitted liability and have refunded her £250.

Do I have any legal obligation to return the £250 excess to them?? I had no idea this money had even been creditied to my account as direct debits immediately swallowed it up.

At present my account does not contain sufficient funds to return the money, and I don't wish to put financial strain on myself attempting to pay back an error they were responsible for.

So, legally...do I have to find a way to pay this back? Can they enforce payment at all?

Thanks...

:eek:

myrnahaz

From reading previous answers on this site, I think you'll find that you have no rights where this money is concerned, and the bank can claim it back from you. I think you may be able to argue the case for paying back in installments.
If you have already used the cash without knowing it was there, how were you intending to cover your existing direct debits?

Bephlam

I didn't realise the money was there because I am paid on a weekly basis and the funds are forever changing in my account due to the nature of my work. I am a nurse through an agency, so at times I have £100 a week going in to my account, other times a £1000. I don't keep a close eye on my account, hence the reason the error was made, and money was debited, as normal without realising there was too much money in the account. Since then I have paid bills, etc causing my balance to drop. It all makes perfect sense if you think it through logically.

I couldn't find any relevant postings on the site, but perhaps I haven't looked in the right category!

My friend did query with the bank how they propse to get the money back, and they said they would write requesting the money but if I refused they would have to accept they made a mistake. Which, suggested to me that perhaps they have no legal right to retrieve the money. They did make it clear that they have no authority with the RBS and as such couldn't remove the funds without permission.

I'm not trying to 'steal' cash...I will pay the amount back in full that they overpaid. I'm simply intrigued as to my legal standing on this matter, as the bank appear to be handling it all very 'sheepishly'...which usually suggests they NEED your co-operation. Goodness knows they behave like a bull in a china shop when they have the legal right to something!

:j

geordie_joe

I think what the bank means is it won't be worth while fighting you for it if you don't give it back freely. They have every legal right to it back, but sometimes enforcing your legal rights costs more than they are worth.

As for your legal rights, they are the same as they would be if the bank accidentally set up a DD and TOOK £250 from your account instead of paying £250 into your account.

If this happened you would be shouting at them to put the mistake right, wouldn't you. The law sees both as the same thing, mistakes that should be rectified.

Bephlam

Good point Joe! I would most definitely expect my money back if a bank accidentally set up a DD from my account without authorisation. I fully intend to pay the bank back the over payment, however I will not be in a position to pay it in full immediately, hence the questioning on my legal rights. We all know banks can be a little heavy handed if and when they want something (whether it's their error or not) and I didn't want to feel pressured in to anything by them.

I have been in a similar situation before where I cancelled a DD through the bank, only to find out later that they had not processed my request and as such have had my account debited with a payment that was not authorised. On these occassions the bank held their hand up for their mistake, but refused to credit my account with the funds, instead suggesting I contact the company...who have not always been helpful, and in turn have found myself waiting MONTHS for a refund on funds the bank should never have released to them.

I have every intention of paying the amount back, but will not be jumping through hoops, and causing myself any inconvenience for it.

I'm fully aware of how I need to act to be MORALLY correct, however my question was about what's LEGALLY correct.

Thanks anyway guys.... Barclays will receive their £250 refund at my earliest convenience! :rolleyes:

jonesMUFCforever

Since the extra money was never yours in the first place (it matters not one jot how often you get paid or how many entries on your statement) then your bank can and probably will debit your account in the near future.

geordie_joe

Bephlam wrote: »

Good point Joe! I would most definitely expect my money back if a bank accidentally set up a DD from my account without authorisation. I fully intend to pay the bank back the over payment, however I will not be in a position to pay it in full immediately, hence the questioning on my legal rights.

Personally I think if you offer to pay in installments they will accept it. After all, they made a mistake so can hardly penalise you for making a mistake.

I think if you tell them what you have told us you will be fine. They won't take you to court, won't want to explain to the judge that they made a mistake which meant your DDs where honoured and now someone else has taken their money out of your bank.

Basically they will be saying "Look judge, we made a mistake and paid too much into this persons bank account. This led to a third party taking the money and this person has offered to pay it back. What can you do about it?"

The judge will just say "i can sit back and let this person pay it back as they have said they will. Now, when are you going to pay the court costs you have incurred?"

Bephlam

Yeah, I'm confident they can't do anything to me for their mistake. I mean, there is nothing I can do at this stage, but the manager of the bank who made the mistake have assured my friend that they will contact me through the 'complaints procedure' in due course. Apparently it's happened to a lot of people due to a new system.

Although, I have to make it clear that there always was enough money in my account to honour my DDs. I simply assumed what was left in my bank was mine to spend, as I didn't expect anything else to credit or debit my account at that stage in the month. Once your bills are paid the amount left in the account tends to be yours to spend....usually!!

Anyway, I am putting this to rest now....I'm going to allocate £250 from my savings account to cover the over payment should they request it soon(ish). Everything will be paid in full, immediately, assuming I don't NEED my cash before hand for anything! :rotfl:

Thanks again...

Bephlam

jonesMUFCforever wrote: »

Since the extra money was never yours in the first place (it matters not one jot how often you get paid or how many entries on your statement) then your bank can and probably will debit your account in the near future.

I've already checked this out Jones, and I'm afraid you're wrong on this matter. My bank will not debit my account at all, as they have no need/permission to do so. If the error had been made by the RBS group they could have debited the account instantly and rectified their error (which would be much more convenient for all) however, because the error was made by a different group entirely, the other group have no authority to remove funds from RBS group.

I wasn't trying to justify ownership of the extra money in my account with an explanation of my payments...I was simply explaining why an extra amount would not be noticed from a cashline reading alone. Without a set montly wage payment being credited to my account...there tends to be no pattern to my money fluctuations. Without a detailed read out it's very difficult to check if the total is 'accurate'.

I don't feel I have any reason to justify my integrity on here, but can't help but feel some of the comments have been suggesting that I am trying to scam an extra £250 for fun. There is not such a thing as easy money!!

I pure and simply wanted to know where I'd stand if they become a little heavy handed in their pursuit of their refund.

The end!

myrnahaz

Don't stress yourself over this - they CAN'T just withdraw the cash. There's no doubt that they'll want it back but they won't get heavy handed, particularly if you offer a repayment schedule.
If I was you, I'd just wait until they contact you and then just tell them that the cash was absorbed into your overdraft so there are no funds available but you can repay it at £10 per month. I have no doubt they'd agree.

Bephlam

Yeah, you're right Myrna....!!

Thanks again folks.