Mistakes happen from time to time, no matter how much care we take, and that includes when we do our banking. Sending money to the wrong person can result from a simple moment of inattention while doing internet-banking or copying a bank account number from an invoice or website. Of course, it goes without saying that care is essential when entering and giving out account numbers. They are a crucial piece of information because transactions are processed by account number.
Banks have begun matching account names and numbers to try to prevent mistaken payments, as well as prevent scams, using what is known as a confirmation of payee service. See our guide here.
In this quick guide, we explain how to retrieve money you’ve sent to the wrong account, as well as what to do if you wrongly receive money.
Sending a payment to the wrong account
Contact your bank as soon as possible after realising your mistake. The sooner you do this, the better your chance of recovering your money. If your money went to an invalid account, it will usually bounce back into your account.
Retrieving a mistaken payment to a valid account can be more difficult. As a general rule, banks can reverse a payment made in error only with the consent of the person who received it. Your bank and the recipient’s bank will need to co-operate to try to recover the payment. This usually involves the recipient’s bank contacting the account holder to ask his or her permission to reverse the transaction.
If the recipient refuses, your only option is to take up the matter directly yourself. However, the bank’s responsibility to protect the privacy of the recipient’s contact details may prove an initial stumbling block. You may wish to take court action if the recipient won’t return the money. We recommend you seek legal advice if faced with taking such a step.
Receiving an unentitled payment
The same applies if you receive a payment you are not entitled to: you should contact your bank as soon as possible to advise it of the error. And once you have been asked for your consent to reverse the payment to its rightful owner, you should agree. Some people feel they should be allowed to keep money paid into their account, but in general they should return money that does not belong to them.
Someone receives money meant for you
If someone owes you money but deposits the money by mistake into someone else’s account, it is not your responsibility to chase it up. The person who made the mistake is responsible for trying to recover the money, and whether successful or not is still obliged to pay you.
It is a different matter if you have given the payer the wrong account details. In that case, the payer has simply followed your instructions, so you must bear the loss if the funds can’t be retrieved. You should ask the payer to seek the recipient’s consent to retrieve the money. If the recipient won’t return the money, you may have to take legal action.
Checking account name and number
The banks’ confirmation of payee service tells you whether the account name and number of the person or organisation you intend sending money to matches. See our guide on confirmation of payee for more information.
For detailed information about the confirmation of payee service, visit FAQ | GetVerified.
The sooner you contact your bank after a mistaken transaction, the better your chance of recovering your money.
Bank not liable for $35,000 customer accidentally sent to wrong person
At the time of payment (2022) banks did not have to check that the account name and number matched.
In November 2022, Petra made a payment of $10,000 intended for her son’s company account to another person who had been a previous payee. Petra failed to notice she had accidentally inserted this person’s details as the recipient when making the payment. She made the same mistake twice more, sending another $10,000 in December 2022 and $15,000 in February 2023. When she realised her mistake, she asked the recipient to return the money. He refused.
Petra asked the bank to compensate her for the loss, saying the mistake would have been prevented if the bank had matched the account name and number. She also said the bank failed to tell her it did not carry out such checks. Furthermore, she said the recipient had his account at the same bank as Petra, so the bank should have detected the transactions as suspicious.
Refusal, not delay, behind non-return of money
Lee wanted to transfer her credit card balance from bank A to bank B. While completing a form at bank B to authorise the transfer, she entered the wrong account number. As a result, her money went into a Alex's account at bank A instead, leaving her with a debt at both banks.
Direct debits
A direct debit authority gives an individual or company permission to take funds directly from your bank account. A typical example is when you arrange a direct debit with your power or telecommunications company so your monthly bill is automatically paid from your account.
To set up a direct debit, you complete a direct debit authority form from the company (which is then called a direct debit i…
Cheques
What to do if you receive foreign chequesIf you receive foreign cheques, you will need to contact the issuer to make other arrangements to receive the payments. If your cheques are for an overseas government pension you may be able to register to receive the payments electronically. You can contact your bank for advice if you have any questions about your options.
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ATMs
SecurityWhen entering your PIN, shield your hand from view so people around you can't see it. This reduces the chance of somebody "shoulder surfing" your PIN and using your card fraudulently. Some ATMs have built-in security features to protect customers from fraud. You won't be held responsible for fraudulent use of your card as long as you take reasonable care when using an ATM.
Fees and charge…
Updated December 2024