‘My £7,000 just vanished': How a slip of a finger could cost your life savings

| August 15, 2012 | 0 Comments

Ruth Lythe

18:54 EST, 14 August 2012


01:32 EST, 15 August 2012

Banks and building societies are routinely fobbing off customers who make a mistake transferring money online — leaving many people thousands of pounds out of pocket.

A Money Mail investigation has found how bank customers who accidentally transfer funds into the wrong bank account are being denied the right to have their money back.

They are left powerless as their bank, and that of the recipient, often refuse to help rectify the error.


Julia Galloway

Julia Gallaway spent weeks hunting for a £7,000 payment that went missing because of an online banking error.

Miss Gallaway, 55 (pictured), was trying to pay off the remainder of her mortgage and had transferred the cash from Santander to Nationwide in January.

However, she did not realise that as well as typing in the correct account number she also had to provide a reference for the payment to be accepted by Nationwide.

The money failed to appear in her account and instead disappeared into Nationwide’s systems.

‘The stress was enormous — I had no idea where the money had gone,’ says Miss Gallaway, a council worker from Barnet, North London.

‘I eventually had to track down an IT worker at one of the banks, who managed to track the cash for me.’

After making a formal complaint, the money was returned by Santander.  Nationwide says it is investigating. Santander says it did not make a mistake and acted as quickly as it could.

In one case, the customer was left thousands of pounds out of pocket because the bank said it had to stop the person who had mistakenly received it from going overdrawn.

This is despite clear rules that prevent someone benefiting from cash that they have received in their account by accident.

Despite a boom in online banking, the rules protecting bank customers are still stuck in the Dark Ages.

Money Mail first revealed concerns about mistakes made with online transfers earlier this year — but it appears the problem is growing.

Trade bodies the British Bankers’ Association and Payments Council, which oversee transactions, are turning a blind eye to the problem as neither keep any track of the numbers affected.

And there are wild differences in the amount of help banks will offer customers who make a mistake.


Today, nearly 20 million Britons have used an online bank account at some point, according to the Office for National Statistics.

Every year, millions of pounds goes astray when customers accidentally enter the wrong account number or sort code during a transfer.

This cash can be anything from a few pounds sent as a gift to help a relative or friend, to life savings transferred into a new account.

Experts say the problem is on the rise because of the growing number of savers turning to internet banking and the growth of apps that allow people to transfer money using their mobile phone.

Mistakes are often made by inexperienced computer users, people who fail to double-check digits or who have been given incorrect details by the person supposed to be receiving the money.

If you accidentally transfer funds into the wrong account, you can’t simply ask for the transaction to be reversed — particularly if you are moving money between two banks.



Brian Wheatley had to take his bank to the Financial Ombudsman to win back £350 he paid into the wrong account.

Mr Wheatley, 72 (pictured), from Chatham, Kent, transferred the cash from his Nationwide account to his daughter Margaret’s account with Santander.

However, in error he sent the cash to an account Margaret had closed months before instead of her normal current account.

When Nationwide and Santander couldn’t solve the problem,  he turned to the ombudsman. The banks then returned the cash.

Santander says it did not make an error while Nationwide says it acted quickly.

This is because the bank needs proof that the transaction was  made in error.

In theory, this is to protect honest people from fraud. For example, a conman could transfer cash for a new car, drive it away and then simply reverse the transaction after they had left.

But it is also to protect the banks from being ripped off by conmen, as they fear fraudsters could transfer money from one account to another, spend the money and then protest the transaction was made by mistake.

So, in order to get back the money that has been transferred by mistake, banks need to contact the person who received the money in error.

If they are a customer of another bank, that means your bank talking to the other one, and it then speaking to its customer.

However, if that person says they don’t want the transaction to be reversed or, as is most common, simply refuses to speak to their bank, then there is nothing else to be done.

Legally, that person is not allowed to spend the money. In practice, though, little is done to police this rule.

Part of the problem is that the Data Protection Act means you will not be told the identity of the person who has received your money.

The only way to find this information is to go to civil court to get the other bank to reveal the name of the recipient and then you can take them to court, though this is very rare.

Oops: Pressing one incorrect key could cost thousands of pounds

Oops: Pressing one incorrect key could cost thousands of pounds


AN already messy situation is being compounded by banks who routinely refuse to help customers.

Our investigation found a large number of cases where banks had failed to assist customers whose money had gone missing. In theory, the City watchdog, the Financial Services Authority (FSA), says banks must offer ‘reasonable assistance’ in returning money accidentally transferred to the wrong person.

But often banks are not motivated to rectify mistakes that are not their fault — particularly if they are not going to be out of pocket themselves.

This is one of the reasons they are so keen to get everyone to bank online. Not only is online banking much cheaper to run, but it shifts the burden of responsibility on to the customer.

The way banks interpret the FSA’s guidance differs hugely.

Some will try to grab back the cash immediately on your behalf — provided it is a customer of the same bank. Others will leave it up to you — unaided — to chase the recipient of the cash at the other bank.

But dealing with the staff at a bank where you are not a customer can be very difficult indeed.

If it is paid in error to another bank, your bank should contact the other one and ask them to tell the recipient to hand back the money.

However, some banks fail to do even this.

Santander says it’s up to you to contact the other bank and obtain the recipient’s details — even though this could mean a costly court battle.

However, it says it will try to help those who are struggling. Britain’s biggest building society, Nationwide, applies the rules in such a way that they will not recover the owner’s cash if it means the unintended recipient is pushed into their overdraft.

A 65-year-old woman from Newport, South Wales, wanted to move £100,000 from a savings account to her current account. But she entered one wrong digit in her eight-digit account number.

Some of the cash was for her  25-year-old son to help him buy his first home and the rest was earmarked for her retirement. When a few days later the money had failed to appear in her account she contacted Nationwide. It told her the money had gone into another customer’s account.

The building society recovered £98,600 of her cash. However, it refused to hand back the remaining £1,400. Nationwide says clawing back the cash would push the other customer into their overdraft.

The woman claims Nationwide told her that if she wanted her money back, she would have to chase the other person through the courts.

‘I realise it was my fault that I entered the wrong account number, but it was one wrong digit — which is easy to do,’ she says.

‘The missing £1,400 might not be a lot, but it had taken us years to save it up. It doesn’t seem fair that someone else can take it to pay off their debts just because of one mistake — what if it had been all our money?’

A spokesman for Nationwide says: ‘We will use our best endeavours to speak to the recipient account holder and will aim to collect the remainder of the funds, which would then be returned.

‘We cannot simply re-credit this money as this would set a precedent and potentially encourage unscrupulous individuals to seek to take advantage of our policy over such issues.’

The Financial Ombudsman Service says it has increasingly seen incidents where banks have offered partial refunds — and explained that this is unacceptable.

Fear of fraud and a desperate need to cut costs also prevent banks from ever getting in touch with customers who have accidentally received cash.

After years of mis-selling and scams, many current account customers refuse to pick up the phone, answer emails or open mail from their bank thinking that they will be sold something they don’t want or be fleeced into a scam.

And because so many banks have cut back on local branches, they have lost the face-to-face contact that would allow them to talk to the customer.

This leaves the person who made the mistake totally stranded.


It isn’t just bank customers who struggle to solve the problem of transfers that go wrong.

The police and the ombudsman have been left relatively powerless to help people who have lost money.

The police rarely help with individual problems of missing money in bank accounts.

Most of the time they let the banks sort out cases of fraud and as a result missing money transfers are rarely investigated.

Part of the problem is that someone filing a complaint would not be able to say who was in receipt of their money. They also wouldn’t know if it had been spent.

The ombudsman is also hampered by data protection laws.

This law is designed to protect our personal data from falling into the wrong hands. So, it means a bank cannot give out the name and address of a person who has received your money, to you or to the ombudsman.

While the ombudsman has powers to ensure the banks are dealing with complaints properly, it cannot force a bank to reverse a transfer.

And it cannot force a customer to answer inquiries or hand back cash that is not theirs.


There are some simple steps you can take to prevent transferring funds into the wrong account.

When you set up a new payment for the first time, check and check again that the details are correct.

These details should be stored by your online bank.

Then transfer a small sum to the new recipient. Call them to see if the money has reached their account. If it has, then use the payment details stored on your online account to transfer the remainder of the funds.

But not even this simple suggestion is straightforward, because bank computer systems often register multiple transactions, particularly where one is for a small amount, as fraud.

And this will protect you only when the mistake is yours, not if someone has given you incorrect details.

If you are still nervous, use the bank branch. Then the onus should be on staff there to check the details are correct.

If the bank makes a mistake, they have the power to haul back the money immediately.

You can find more tips on how to stay safe online at thisismoney. co.uk/online.


Here’s what other readers have said. Why not add your thoughts,
or debate this issue live on our message boards.

The comments below have not been moderated.

“This article is utter tosh. See Kelly v. Solari 1841. Money paid under a mistake of fact is recoverable in full.
– Ron White, Thame, Oxon, 15/8/2012 7:09″
With respect you’ve missed the point entirely. The money is recoverable from the recipient, not the bank. if you don’t know who the recipient is because you only know you got a number wrong where does that leave you? In 1841 terms, if Kelly had sent a cheque with no identified payee to an inadequate address, he would not have succeeded if he’d sued the post office.

Banks and building societies should have to pay daily interest for every day they fail to allocate the money or clear up the mess. It happened to me recently but the money was returned automatically so it can be done.

My 76 year old husband was sending £1,000 to cover a payment. On the list of our bank he could not find the section he wanted, but thought another with a slightly different number in the code was some sort of holding account he sent it there only to find it was non-existent. He informed the bank straight away and they said they could not help. Enquiries were made and we were told it had gone to another Banks’ customer account, who they then contacted but were informed that they could not get it back, and when we checked it, we found it was possibly owned by a Company that had gone into Liquidation. We went to the Ombudsman but his advice was to accept what our bank offered in compensation, which we had to do in the end. Nowhere near the £1,000. Surely that Account should not have still been listed in our banks’ receipt list.

I once made an error in giving an account number and £10 000 disappeared as we were about to complete a house purchase, but when I went into my Naionwide branch in Bolton, the first thing I was told was Don’t panic, we can try and sort it out. They did exactly that, luckily the number I had erroneously used was a dormant account and the money was back in my account quickly. If the person into whose account money incorrectly arrives refuses to return it, is that not the crime of obtaining by a pecuniary advantage?

This happened to me with the Smile bank. My water rates payment disappeared into another person’s account in another bank and Smile did nothing to retrieve the money. I had to pay my water rates again which I did in cash at a pay point in a local shop.

Why people don’t check 100% before pressing ‘submit’ I’ll never know “/

Trust me, Santander NEVER make a mistake. They’ve told me this in their one paragraph letter which was in response to my eight letters! Santander are the invincible Superbank! They fly in and destroy your credit at a moments notice with extreme arrogance. I wish them and all other Superbanks like them a trip to a far off galaxy, preferably on a large rocket made of kryptonite!

This happened to me. I lost £300 by accidentally transferring it to an ex-landlady, whose contact details I did not have. Almost worse than losing the money, which I could ill afford at the time, my bank led me to believe for about 6 weeks that they were working on retrieving the money, only to then inform me that actually there was nothing they could do about it. I wrote to the bank of the landlady in question, but of course never heard back from them. It was gutting.

I had a similar experience using the natwest ap. I accidentally sent 10,000 to edf energy instead of my lawyers. At the time the ap was the only way I could transfer the money as my online banking did not work and I could not do it over the phone or in a branch- this was during natwests blackout- and I desperately needed the money to go out to complete on a flat. I rang natwest immeiately who admitted it was quite easy to do this on the ap due to the scrolling function, however they couldn’t stop the transaction as it had already gone out… They basically hung up on me. Luckily edf were extremely helpful and happily refunded the money but it could have been so much worse. I am aware that it was mistake but with human error playing such a factor in online banking there should be safeguards

Dimwits. QED

The views expressed in the contents above are those of our users and do not necessarily reflect the views of MailOnline.

Leave a Reply

You must be logged in to post a comment.

Get Adobe Flash player