Standing Order Recall

John1360

I run a small sports club where fees are collected monthly via standing order into my online business account. due to the current situation I had to stop running the club in March. I immediately set about informing members to cancel their direct debits. I had one member who after repeated attempts at contact continued  to make payments.  Eventually they made contact with me and suggested I had taken their money,.I explained I had made repeated attempts at contact and agreed to  refund them their April free payment but they needed to cancel their standing order to prevent further payment coming to me.  In May I saw a an unexpected payment leave my account which equated to 2 month fees but with no reference as to what it was. I contacted my bank which can only be done via app and 4 weeks later they replied the amount debited was a recalled standing order to the very same club member, who had recalled fees for March and April. Apart from fact my club member seems to have benefited from 2 months refund one of which not owed but also from the refund I gave them personally. Does anyone know if banks are able to return payments from standing orders without contacting the account holder i.e. me ?  

eskbanker

No, your bank shouldn't have returned these payments without any dialogue with you.  Raise a complaint....

mab3000

You have mentioned that these payments are both standing orders and direct debits. Just to clarify, which one is it? As they are both different. 

Going by the rest of your post I’m going to assume that these payments are standing orders. You can’t just recall a standing order as such unlike a direct debit. They have probably contacted their bank to say that they have sent money to you in error and that they have attempted to get the money back from but you haven’t offered to send it back. So they have attempted to recover the money from the account and as funds are available from your account they have have taken them to give them back to you. They may have done this before you attempted to contact them, as it takes a little while for banks to deal with these sort of cases. 

You should try and contact this particular member and say that you have refunded them and the bank has taken the money from you as well. If they fail to send the money back, you should approach your bank and that you have sent money to them in error so that they can try and recover the funds you have sent them which they are not entitled to.

Archi_Bald

First things first - are we talking about standing orders or about direct debits? 

eskbanker

mab3000 said:

They have probably contacted their bank to say that they have sent money to you in error and that they have attempted to get the money back from but you haven’t offered to send it back. So they have attempted to recover the money from the account and as funds are available from your account they have have taken them to give them back to you.

Anything's possible I suppose, but that's emphatically not how things are supposed to work, so if that's what happened then OP should throw the book at their bank.

There is a standardised process for retrieving misdirected payments, but it's intended for use when sending funds to the wrong account, and the member concerned could hardly claim that if it was a standing order!  In any case, under that process, the receiving bank isn't allowed to send the money back without dialogue with the customer, the sending bank can't just unilaterally decide to reclaim it.

Archi_Bald

If it was a Direct Debit, however, the bank can recall it without consulting the recipient, can't they?

John1360

Sorry for the inconsistency. definitely a standing order. 

eskbanker

Archi_Bald said:

If it was a Direct Debit, however, the bank can recall it without consulting the recipient, can't they?

Indeed - I'd already decided on the balance of probability that it was SOs under discussion rather than DDs, not least from the fact that if it was DDs then OP wouldn't have needed to write to all members asking them to stop paying and would simply have stopped collecting payments!

mab3000

eskbanker said:

Anything's possible I suppose, but that's emphatically not how things are supposed to work, so if that's what happened then OP should throw the book at their bank.

I had thought this would be the case but I have seen cases where people have had money reversed from their accounts for occasions where they have received money incorrectly and not been notified about this. So they say anyway.

Archi_Bald

John1360 said:

Sorry for the inconsistency. definitely a standing order. 

Thanks for clarifying. In which case, proceed as eskbanker suggests. Good luck.

eskbanker

mab3000 said:

eskbanker said:

Anything's possible I suppose, but that's emphatically not how things are supposed to work, so if that's what happened then OP should throw the book at their bank.

I had thought this would be the case but I have seen cases where people have had money reversed from their accounts for occasions where they have received money incorrectly and not been notified about this. So they say anyway.

Reversed on what grounds and via what process?  Do you have any links?