One digit wrong, $2000 lost: Man who paid money to wrong account urged to drop complaint

RNZ News

21-05-2025

The man paid the wrong person when he entered the wrong suffix. (File image)
Photo:
123rf
A man who lost $2000 when he got one number wrong in a bank transfer has been told to drop his complaint.
He complained to Financial Services Complaints Ltd (FSCL) after the money was lost.
The man realised he had entered the recipient account number incorrectly when the money did not turn up. FSCL said he had entered 05 instead of 55 as the suffix, and did not pick up on the mistake before the transfer was processed.
He contacted his bank, but was told it could not help because he had authorised the transfer.
The money transfer service said it was not its mistake because the money had gone to the account that had been entered.
"The service attempted to recall the money from the recipient, but the recall was unsuccessful because the recipient did not respond. They explained that they were not responsible for [the man's] loss because they were not aware that he had made a mistake in the recipient details when the transfer was made.
"[He] understood that the service had attempted to recall the money, but he believed there may be additional steps that could have been taken to ensure a better outcome. [He] thought the service could have had a stronger follow-up process with the recipient, to ensure that they were aware of the situation and the urgency. [He] asked if the service could try harder to recover the funds, as he was left with no other recourse."
FSCL said nothing more could be reasonably expected from the service to try to recall the money.
"The service acted promptly once they had been notified that the transfer had been made in error. It was unfortunate that the recipient did not respond to the service, however, the service was not obliged to continue to follow up with the recipient or to attempt to escalate the recall directly to the recipient's bank. The service did not make the mistake and were not responsible for [the] loss."
Banking Ombudsman Nicola Sladden earlier said banks could reverse a payment with the consent of the person who received it, but if that did not work people might end up having to pursue the money themselves. The introduction of account name matching
should make these sorts of mistakes less frequent
.
Hamish Dempster, senior lecturer in the school of accounting and commercial law at Victoria University, said it was a complex issue.
"There can be civil and criminal consequences, depending on the facts."
He pointed to a case more than a decade ago when Leo Gao and Kara Hurring were
mistakenly given $10 million by Westpac
.
They were on the run for two years but were eventually caught, found guilty of theft and
sentenced to prison and home detention, respectively, for their roles
.
"The bank would not want to get involved because any unwinding of the payment puts the bank out of pocket - because its liability to the customer would increase by the amount of the payment - and it would then need to recover from the payee.
"It would most likely say to its customer, 'It's up to you to recover from the payee.' That would involve a claim under the civil law in money had and received. It's not certain the claim would succeed because money… received traditionally involved claims in relation to money itself, and here we are talking about a 'payment' through the payments system without using money itself."
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