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What to Do if you Send Money to the Wrong Bank Account

What to Do if you Send Money to the Wrong Bank Account

If you have ever sent money to the wrong bank account in error, then you are certainly not the only person that has ever made this mistake. Research suggests that one in ten people have done this in the last year alone.

If money has been sent to the wrong account, then there are best practice procedures that most banks will follow. While this does not guarantee you will get your money back, it does provide you with reassurance that there are specific steps your bank will need to take to try and recover the money.

Get In Touch With Your Bank Immediately

The quicker you act after you realise the mistake has been made, the easier it will be to retrieve your money. The first step is to get in touch with your bank. Explain to them what happened and ask them to use the ‘misdirected payments’ code of practice. The more detail you can give about what went wrong when you were entering the payment details, the better.

If the problem was that you entered account details with one or more wrong digit, then this will bounce back if it does not match an actual account. This should take a day or two to show back in your account.

If the money was sent to the wrong recipient, then the bank will have more work to do but it should be possible for them to try to reclaim the money immediately. If they can get the money back, then this will be returned to your account and it will be the end of the issue. This should happen in the majority of cases. However, there will be times when further action may be necessary.

What Action Will The Bank Take?

The misdirected payment code of conduct gives banks a process that they will need to follow from the moment that they are informed that a payment was sent in error. Details of this process can be found below.

  • Your bank should start looking into where the money has gone within two days of you reporting that money has been sent to the wrong account.
  • If the banks finds “clear evidence” that a genuine mistake has been made they will contact the receiving bank to request that the money is not made available to spend. If this is not disputed by the person that has received the money, then a refund should be made into your account within twenty days.
  • Even if the circumstances around how the money came to be sent are less clear cut, then your bank can ask the receiving bank to for consent to debit the account that received the money. However, this cannot take place if the consent is not received.

What Happens If The Bank Can’t Return The Money?

If the recipient disputes that the money was sent in error, then a more detailed investigation will need to take place. The bank should get back to you with the outcome of this investigation within fifteen business days. Unfortunately, if the money has been moved out of the account by the recipient, and there aren’t enough funds in there to cover the repayment in full, then there is very little that the bank can do.

If the bank is unable to get your money back, they still have a duty to provide you with information about what the next steps are. This includes taking the recipient to court in order to try to get the money back. It is recommended that you get independent legal advice if this is a course of action that you want to follow.

It is always worth remembering that if someone knowingly spends the money that they have been sent in error, then this can be considered as theft.

What Action Can Be Taken If You Are Not Happy With The Service You Have Received?

If you do not believe the bank has done all it can under the misdirected payments code of practice, then you are entitled to make a formal complaint. There will be a procedure for this, and your bank should provide you with this when they are asked.

If you have followed this procedure and you are still not happy with the resolution, then you can refer the matter to the Financial Ombudsman Service.

What Is Confirmation Of Payee?

Confirmation Of Payee is a new service that has recently been introduced by banks to try and prevent money being sent to the wrong account by mistake or because of fraud. If the name on the account does not match the sort code and account number, then you will be asked to check that you have all the correct details before the payment can go through. Most major banks in the UK are signed up to this scheme.

How Can You Prevent Payments Going To The Wrong Account?

There are some steps you can follow to try and ensure you do not have the same problem again in the future.

  • Double check all details before you send any money. This includes the sort code, account number and any payment reference if you are paying a bill.
  • If you have a large amount of money to send, don’t do it all in one go. Send a smaller amount at first and then check with the recipient that it has been received. If this payment has been successful, then you can go on to send the rest of the money.

What Should You Do If You Receive Money In Your Account That You Were Not Expecting?

If you notice an unexpected deposit in your account that you do not recognise, then you should get in touch with your bank. They may be able to provide you with details about the transaction which could help you determine if it was really meant for you. There can be consequences for keeping money that does not belong to you, and so you should tell your bank if you suspect that the money has been sent by mistake.