Call us: 0800 347 257

Confidential phone notes

Megan used a money transfer service in May 2022 to transfer $850 to her father’s overseas bank account. Megan had typed one digit in the account number incorrectly, causing the money to be transferred to the incorrect account. Megan said that she called the money transfer service immediately, and they informed her she would be refunded within seven working days.

Megan continued to contact the money transfer service over several months. In mid-August, the service informed Megan that the funds had been successfully transferred to the account number typed on the transfer instruction and the relevant recipient bank could not retrieve the money. Due to this, the money transfer service could not refund her. Megan complained to FSCL.


Megan said that she had been told to expect the refund within seven days, so was unhappy with the time it took for the service to tell her they would not refund her. She questioned how it was possible that the money had been transferred when the receiver’s name would not have matched the name associated with the incorrect account number. She believed that the service’s terms and conditions protected against such a discrepancy. Further, Megan complained that the service’s communications were poor, particularly in the lack of updates and the time taken to reach a final decision.

The money transfer service said they did not tell Megan that she would receive a refund. The service said that the funds had been successfully deposited and were no longer in their possession, so they could not refund her.


Contact notes

At the beginning of our investigation the service supplied their contact notes and requested the notes remain confidential from Megan. The service no longer held recordings of Megan’s calls, so the notes were the only record.

Under our terms of reference, the service should have notified us of their request for confidentiality before supplying the contact notes. If the service had made this request before sending the notes, we likely would have declined their request. We asked the service to provide the notes in a form that we could share with Megan, but the service declined.

While we agreed to keep the notes confidential, we could not rely on them when making a decision because the rules of natural justice require that information relied on in reaching a decision be made available to both parties.

The service and Megan had different versions of events as to whether she had been told she would receive a refund. As we could not provide the contact notes to Megan, we preferred Megan’s version of events of the telephone call about a refund.

Preliminary decision

Despite preferring Megan’s version of events in our preliminary decision, we concluded that the service did not have to refund the amount transferred. Under their contract, the service were not liable for the mistake that Megan had made. The contract stated that the service were deemed to have made the transfer properly if the information Megan gave them about the receiver’s account was incorrect, and the service made the transfer based on that wrong information.

Most banking systems do not require that the account number and the account name match for the deposit to be successful. The service made reasonable efforts to stop the transfer, according to their terms and conditions and general good practice.

The terms and conditions said that the provider may be able to cancel the transfer before the receiver received the funds. The provider gave evidence to support that they had contacted the bank and were told a refund was unavailable. On balance, we did not consider it reasonable to expect the provider to compensate Megan for the financial loss suffered.

However, we found that the provider should compensate Megan for non-financial loss in order to recognise their poor communications, including giving her the wrong information about being refunded. We found it would have been upsetting for Megan to be told that she would receive a refund, and then later be told this was incorrect. On balance, we found that $500 was a fair amount.

Final decision

Megan agreed with our preliminary decision, but the money transfer service did not. After issuing our preliminary decision, the provider agreed we could provide the contact notes to Megan. Now that we could consider the contact notes, we no longer preferred Megan’s version of events. The contact notes supported that Megan thought she would be refunded, but there was no evidence that the provider represented that she would be refunded – rather that the provider would make an effort to retrieve the funds. This led us to conclude that the provider did not have to compensate Megan for providing her incorrect information.

However, we remained of the view that the provider’s communications were poor. The contact notes showed more than 10 contact attempts from Megan to resolve the issue. The provider told Megan in mid-June that they would investigate her concerns as a priority but did not issue their decision for almost two months. Further, the delay in providing the appropriate contact notes prolonged our investigation and caused Megan further inconvenience. We found that $250 was fair non-financial loss compensation.


Megan accepted our final decision, and the provider paid her $250. We closed our file.

Insights for consumers and participants

People using a money transfer provider should be careful when entering an account number, particularly if under the terms and conditions the provider does not have to refund you if they cannot retrieve the funds. It pays to double check that you’ve entered the correct account number.

FSCL participants should contact us if they want to provide information in confidence before they send us the information so that we can ensure the processes of natural justice are upheld.