Can investment bank claw back Dividend they paid to me in error?

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Collectorfox
Collectorfox Posts: 2 Newbie
in Savings & investments
Back in March HSBC Direct Invest allowed the payment of a dividend into my account. It was for shares I own in a company on the AIM market where it was ex dividend but the company announced right at the last moment that it was not going to pay it. However it was paid in to my account and there it has stayed since.

However today I got a letter from HBSC saying that 'We are sorry to advise that due to the late market notification, this event was cancelled by the company in the market, meaning that you were not entitled to the dividend'. It goes on to state that they will be clawing the money back at the end of this month.

Can they do that?
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Comments

  • doubletop40
    doubletop40 Posts: 361 Forumite
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    Yes. Its not your money.


    You could argue, but you will lose.
  • AimHigh
    AimHigh Posts: 135 Forumite
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    Why would you want to keep it?

    If you paid money into the wrong person's account by accident then you'd certainly expect it back?
  • george4064
    george4064 Posts: 2,811 Forumite
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    As others have said, just give it back. You!!!8217;ll never win if you fight.
    "If you aren’t willing to own a stock for ten years, don’t even think about owning it for ten minutes” Warren Buffett

    Save £12k in 2021 - #027 £15,268 (76%)
  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
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    As long as you agree that for all future cases where you accidentally pay someone money, they can keep it, then I don't see an issue with you keeping this dividend.
  • Collectorfox
    Collectorfox Posts: 2 Newbie
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    Gosh you guys are harsh! But yes the money has stayed in the account as I figured the error would come to light one day. Just curious with regard to time passed etc but thanks for your comments.
  • le_loup
    le_loup Posts: 4,047 Forumite
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    Theft, i.e. keeping money that does not belong to you is also a bit harsh.
  • adonis10
    adonis10 Posts: 1,810 Forumite
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    le_loup wrote: »
    Theft, i.e. keeping money that does not belong to you is also a bit harsh.
    Is it theft given that the OP did not initiate the transfer?
  • Malthusian
    Malthusian Posts: 10,938 Forumite
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    adonis10 wrote: »
    Is it theft given that the OP did not initiate the transfer?


    No, but it would be theft by finding if he kept it.
  • Paul_DNAP
    Paul_DNAP Posts: 751 Forumite
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    Of course, if it was a sum of money you don't have instant access to then they would have to listen to a reasonable offer of how you can pay it back to replace their preferred immediate reversal, but best to get things squared up as soon as possible if you can.
    I wonder, hypothetically speaking, if you'd put it away in a five year fixed bond and you had to pay a penalty to get it back then they'd offer (or could you force them) to pay the penalty for you?
    (Although I could be wrong, I often am.)
  • Malthusian
    Malthusian Posts: 10,938 Forumite
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    Paul_DNAP wrote: »
    I wonder, hypothetically speaking, if you'd put it away in a five year fixed bond and you had to pay a penalty to get it back then they'd offer (or could you force them) to pay the penalty for you?

    Given this is a dividend from an AIM company, which suggests a) low yield b) the OP will have a relatively small proportion of his assets invested in it (hopefully), the dividend is unlikely to be a huge sum of money for the OP, and it would take some extremely crass mismanagement for them to be unable to lay their hands on enough cash to repay it without paying a penalty. It wouldn't be HSBC's problem.

    The simplest solution for HSBC in that scenario would simply be to record their cash balance as negative and wait for further dividends to come in or for the OP to make a withdrawal, at which point the money would be recovered. HSBC may have a clause in the T&Cs which says that if the cash balance is negative, they can sell down the OP's assets without permission to correct it. If not, they just have to wait.

    If the OP withdrew all their money off the platform (including the dividend) in the hope that HSBC wouldn't be able to recover the mistaken payment, that would be blatant theft by finding.
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