Bank mishandled account dispute involving employee

Categories:
Joint accounts
Summary:
Tama and his partner Sarah had joint accounts and a home loan with their bank. Sarah was also an employee of a subsidiary of the bank. The couple’s relationship ended, and Tama asked the bank to set up internet banking access so he could view information on a transactional account. After a short delay, the information came through, and Tama discovered that Sarah had transferred funds from the account half an hour earlier.

Tama was suspicious about the timing of the transfer and complained to the bank. The bank said it had been unable to identify him when he requested the information, so it had sought Sarah’s permission to release it. Tama was unhappy with the bank’s explanation and complained to us.

Our investigation

We learned that the bank didn’t try to confirm Tama’s identity, nor did it tell him it would contact Sarah about his request. When the bank spoke to Sarah, it was apparently aware of the relationship dispute, but allowed her to transfer the money anyway. The next day, the bank asked Sarah whether it should freeze the account and she replied no. The bank didn’t ask Tama if he wanted the account frozen.

When a bank becomes aware of a dispute over ownership of funds or how an account operates, it should consider whether to freeze the account. It should also treat those involved equally. We considered the bank had not responded as it should have to Tama’s request. We also considered the bank should not have contacted Sarah without his knowledge. And finally, we considered it had not treated Tama fairly once it became aware of the dispute between them.

We explained our position to the bank and Tama. The bank agreed to write Tama a letter of apology. It also offered $1,000 for the inconvenience he had suffered. Just five days had passed between receiving the information and the freezing of the account, so the inconvenience Tama suffered was short-lived. We therefore considered the compensation reasonable. Furthermore, the money Sarah transferred would be considered in their  relationship separation agreement, so Tama was unlikely to have suffered any direct loss.

Outcome

Tama accepted the bank’s apology and offer.

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