Bank wrongly credited my account

concerned43

Last week I transferred money from my ISA into current account leaving it with nil balance - two days later I noticed more money had been credited to my account. When I enquired about it at the bank they said they could only tell me it was an inter-branch transaction and that it was mine! great - so I withdrew it and spent it!
Now bank says they had a computer glitch on the night money was transferred and want it back and now threatening to take me to court!
This from the bank that left me without money for a week last summer as its computers went into meltdown. Anyone know whether I must give the money back?

~Beanie~

Yes, you knew it wasn't yours so the Bank can take action to recover the money.

dr_adidas01

concerned43 wrote: »

- so I withdrew it and spent it!
Now bank says they had a computer glitch on the night money was transferred and want it back and now threatening to take me to court!

So you spent money you knew wasn't yours and now you feel you shouldn't have to pay it back.

Well that's tough it wasn't yours to spend in the first place, so the bank have every right to demand you pay it back.

Lesson to learn from this is: Don't spend money that isn't yours!!!

Lomcevak

The Financial Ombudsman Service says it receives about 100 complaints regarding mis-applied credit every year, mostly from individuals who have seen money come into their account and want to keep it. The ombudsman nearly always rules against them; just because the bank made a mistake does not mean you can keep the cash.

http://www.financial-ombudsman.org.uk/publications/ombudsman-news/87/87-banking-complaints.htm

When dealing with complaints about misapplied credit, we generally take the view that consumers are required to return any money paid to them by mistake.

and in the case given as an example at that link

Mr A sent us documents confirming that he had been expecting a transfer of £1,000. There was nothing to suggest he expected more than this amount ... So we were satisfied that Mr A should have been aware that an error of some kind had occurred – and that the ‘extra’ ... was not his to spend or keep.

The only get-out looks to be if you could reasonably have expected any additional money was yours because of another expected payment - see the case of "Mrs. M" at that link. Based on what you've said, it doesn't seem to be the case here.

Username2013

If the bank made the error don't they just take the money back?

So if your salary gets paid in they can just take what is owed?

Gromitt

concerned43 wrote: »

Anyone know whether I must give the money back?

Lets put it this way, if you don't they can use the right of offset to take it from any of your other accounts with them and any credits made to the account. If all your accounts are empty they can refer it to a debt collection agency or take you to court and you may be required to pay further costs on top of what you already owe.

So in short: Yes.

Herbalus

I was inclined to say at first that when you withdraw your whole balance from an ISA the bank may also have given you a small amount extra, which is interest that you cannot see on your ISA statement (assuming it is calculated daily and paid monthly or annually). Only by knowing the amounts of your withdrawal, your interest rate and the extra amount could you guess if this was the case.

If this isn't it, you will of course have to pay the money back. If you have evidence that they told you the money was yours then you may be able to gain more time to pay it back, but you won't get out of paying it.

sunflower_2

how much is the "error"?

if it is a large amount perhaps they may allow you to pay it back in a couple of instalments ?

hope you spent it on something worthwhile...

ERICS_MUM

I'm a nosey moo so now I want to know how much and what did you spend it on ?

Please don't feel pressured or obliged to tell me !!

Linda xx

matttye

If you knew more money had come into your account than you were expecting, you shouldn't have settled for such a vague response from the bank. 'Inter-branch transaction' isn't good enough. They must surely be able to say WHY the money went into your account.