The Financial Ombudsman Service has warned that customers must act quickly if they make a mistake when transferring money in and out of accounts.
Last year, the service saw a 30% increase in the number of complaints about money transfers, however, under half of the 688 complaints were concluded in favour of the customer.
The cases included problems where payment details had been entered incorrectly, delays and administration problems, disputed currency exchange rates and complaints about fees and charges for transferring money.
One example was where a customer tried to send £1,000 to their child. But they accidentally mistyped one of the digits in the child’s bank account and the money was sent elsewhere.
The customer argued that the bank should have cross checked the name on the daughters bank account with the account number and spotted the error. The ombudsman ruled in favour of the bank. They said that in this case, the bank had made it clear beforehand that they use the account number and sort code to send the payments and that they don’t use the name.
Another case was found in favour of the customer, when the customer used the wrong pre-saved recipient details when sending an online payment to a parent. In this case, the bank didn’t give the customer the opportunity to double check the details before processing the payment. The customer was awarded a full refund with compensation.
In cases where there was an error in entering the payments details of the recipient, the responsibility does not always lie with the bank.
A spokesperson for the Financial Ombudsman Service suggested that it was inevitable that some errors occur. They said: “We see a significant number of complaints involving money being transferred to an unknown third party by mistake. In some cases the money can be recalled, but this relies on the customer and the financial business acting quickly.”