Is on-line banking safe?

CLAPTON

cepheus wrote: »

It seems a trivial problem to me.

Presumably there is some sort of check since the sort code has to correspond to the correct account number. Providing they don't do something silly such as release sequential account numbers from the same branch the chances of a match is remote. The additional check of a surname as well should reduce the probability of a mistake to a million to one even if the wrong account number is typed in.

So why is there a problem?

I guess the Mail have something wrong here, typing wrong numbers must be so common the banking system would quickly grind to a halt unless some sort of check was conducted.

the sort code refers to the bank

different banks allocate accounts codes without reference to other banks
so account code are not unique and so the same a/c code will occur many times with different sort codes.

cepheus

A sort code is a number which represents a bank branch so the chance of typing in a sort code then the wrong account number, and it then matching a valid sort-code account-number combination should be remote. Of course this assumes that account numbers are allocated randomly all over the country.

Even if they are duplicated sometimes it doesn't invalidate this principle, however are you sure?

There seems to be a database here, there are an awful lot of sort codes

http://www.sortcodelookup.co.uk/info/banca/popolare/di/lodi/index.php

CLAPTON

cepheus wrote: »

A sort code is a number which represents a bank branch so the chance of typing in the wrong account number and it matching a valid sort-code account-number combination should be remote. Of course this assumes that account numbers are allocated randomly all over the country.

the 8 digit account code are not unique; so different banks will use the same range of account codes

sort codes represent banks: some banks (mainly the long established ones) allocate different sort codes (within their range) to specific branches but still use the same range of account codes

some banks don't have branches

the sort code and account number combination is of course unique within the Uk banking system.

the point being discussed is whether making a simply mistake (maybe swapping two numbers or mistyping a number) will cause the money to go to the wrong person
and of course it can do.

check digits have the capablity of reducing the probability of this happening.

innovate

CLAPTON wrote: »

The reality is that people do make mistakes
and the process for correcting them is deeply flawed.

In my view we do need to change the current situation.

How many people are making these mistakes every day? I very much doubt that there would be a business case for spending vast amounts of IT resources to introduce some sort of check that can never be foolproof but that satisfies the Daily Mail and a handful of MSEers.

cepheus wrote: »

The additional check of a surname as well should reduce the probability of a mistake to a million to one even if the wrong account number is typed in.

That pre-supposes that, for starters, all banks have stored the surname (or surnames for joint accounts) in separate fields. Which they haven't.

cepheus

CLAPTON wrote: »

the 8 digit account code are not unique; so different banks will use the same range of account codes

sort codes represent banks: some banks (mainly the long established ones) allocate different sort codes (within their range) to specific branches but still use the same range of account codes

some banks don't have branches

the sort code and account number combination is of course unique within the Uk banking system.

the point being discussed is whether making a simply mistake (maybe swapping two numbers or mistyping a number) will cause the money to go to the wrong person
and of course it can do.

check digits have the capablity of reducing the probability of this happening.

Say I type in the wrong account number but the right sort code.

Would this money still get sent to that account number even IF there was no corresponding sort code to match?

If not then what is the probability of both typing in the wrong account number and a matching sort code (whether sort codes are duplicated or not)?

CLAPTON

cepheus wrote: »

Say I type in the wrong account number but the right sort code.

Would this money still get sent to that account number even IF there was no corresponding sort code to match?

If not then what is the probability of both typing in the wrong account number and a matching sort code (whether sort codes are duplicated or not)?

sort codes aren't duplicated; they are uniquely allocated to banks who then use them as they choose.

if you type the correct sort code but the wrong a/c then then it will depend upon how many a/cs codes that particular sort has associated with it..

as a/c numbers are 8 digit long that means there are 99,000,000 possible combinations; however i've no idea how many are actually allocated.

the probability of the number being valid depends both upon the number allocated and on the number of mistakes actually made.

cepheus

Various tales here of similar problems. Somehow I don't believe Banks like to admit they have a cross-checking system just to make customers be more careful.

https://forums.moneysavingexpert.com/discussion/174066

cepheus

This is the point I was getting at

The reduced chance of that combination existing reduces the chance of it genuinely going into someones account, than just typing out the wrong account number, or else it would happen far more frequently. The ones we hear about and cause problems are just the tip of the iceberg, people are probably doing this all the time.

I rang the UK Payments Council, which oversees the payments system, in search of answers. It turned out that it is familiar with "erroneous transfers", which occur when somebody mistypes an account number or a sort code. "If that combination happens to belong to someone else, then that payment will go through to a third party," a spokewoman confirmed.

http://www.guardian.co.uk/money/2012/jan/09/bank-account-250000-error


http://www.bbc.co.uk/news/10301504

gt94sss2

There is a way to check if a UK sort code and account number are a valid combination - its here . However, this doesn't tell if that combination is currently allocated to a bank customer or not.

From personal experience, I know that if you try and make a payment to a 'non valid' combination using HSBC Internet Banking, they won't allow the payment to go.

However, if someone types in a wrong sort code/account number which matches the checking rules as valid it will get paid. If there is no customer it will often stay in a bank holding account for a while before being returned. If there is, they have just received an unexpected payment into their account.

If someone just pays the wrong payee.. thats a slightly separate issue but works just as if someone had typed in a wrong but valid combination..

Regards
Sunil

cepheus

From personal experience, I know that if you try and make a payment to a 'non valid' combination using HSBC Internet Banking, they won't allow the payment to go

gt94sss2 that sounds logical and the way the system should work!

This quote I find difficult to believe, or else my account would be getting credited every month from someone or other!

It is estimated that around one per cent of all online banking transactions are paid to the wrong person due to errors made online by banking customers when inputting the recipient's bank details

http://www.telegraph.co.uk/technology/news/6178323/429m-of-internet-banking-payments-go-astray.html

I suspect that 1% of them are typed in wrong and all but 1% of them bounce. We hear about the 1% x 1% = 0.01% which coincidentally have a matching sort code and account number which ends up in someone elses personal account. And probably only a tenth of them are stolen!