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Help! I transferred money to the wrong person!

Robbie had an account with a money transfer service. In September 2022, he tried to transfer $2,400 to his account. He made an error when entering the account details, and accidentally sent the $2,400 to the wrong account.

Robbie contacted the money transfer service two days later, explaining that he made an error when he entered his account number and that he had not received the funds.

The money transfer service told Robbie that the funds should be returned to his bank because the transfer never made it to his account. However, Robbie’s bank told him the transfer went to a different user at the money transfer service.

The person who received Robbie’s funds (the recipient) withdrew $2,100 on the day Robbie first contacted the money transfer service. The recipient withdrew the remaining $300 five days later.

The money transfer service contacted the recipient two weeks later and asked them to return the funds. The recipient said that they had assumed the payment was related to their business, and that they had already spent the funds. The money transfer service agreed to give the recipient two months to repay the funds.

The money transfer service managed to recover $1,150 from the recipient, which was returned to Robbie. The recipient then stopped responding to the money transfer service. Robbie asked for the recipient’s contact details so he could try to recover the rest of the funds himself. The money transfer service declined to give these details because doing so would breach their privacy policy.

Robbie was unhappy that he was not refunded the full $2,400 and he complained to FSCL.

Dispute

Robbie said the money transfer service did not act fast enough to recover the funds and that they did not follow their terms and conditions.

The money transfer service said they did what they could to recover Robbie’s funds. They offered him $150 on a goodwill basis to resolve the complaint.

Review

We explained to Robbie that the money transfer service’s goodwill offer was reasonable.

We agreed that the money transfer service had not acted fast enough. If they had identified the recipient’s account when Robbie first contacted them, an extra $300 could potentially have been recovered from the recipient. The money transfer service’s offer of half that amount was a reasonable offer. 

It was unfortunate that the money transfer service was not able to recover all of Robbie’s funds, but ultimately his error had caused the loss.

Resolution

Robbie did not accept the offer. He decided to take his complaint elsewhere.

Insights for consumers

When transferring money between accounts, it is important to check the account details before you confirm the transfer. If you transfer money to the wrong account, your financial service provider may not be able to recover the money from the person that received it.