How to Handle a Bank Error in Your Favor
As you’re likely aware, bank aren’t perfect. Sometimes they make mistakes. And sometimes those mistakes actually favor the customer. Over the past week I’ve been dealing with a fairly significant bank error in our favor – as they say in Monopoly – and thought I’d share the story.
The backstory
A week ago this past Wednesday, I made a transfer from Bank A to Bank B. For a variety of reasons, none of which are very interesting, I had to do this by phone. So… I called Bank B, gave them the Bank A routing and account numbers along with the amount, and went merrily on my way.
The next day (Thursday), I decided to do another transfer in the same amount, so I again called Bank B, talked them through what I wanted to do, and once again went merrily on my way.
On Friday night, I checked both accounts. Much to my surprise, there were three deposits into my account at Bank B. Uh oh. It looks like one of the transfers got duplicated. Concerned, I checked Bank A. Two withdrawals had hit – was another one lingering out there in the ether?
Of course, we were heading into Labor Day weekend, so I’d have to wait extra long to find out. Isn’t that how it always works out?
Untangling the mess
Concerned that we’d get hit with a third transfer out of Bank A, I called both banks. Bank B said that they were only showing two transfer requests, and couldn’t explain the third deposit. Regardless, they promised to cover any fees that we might incur.
Over at Bank A, they were only showing two withdrawal requests so far. They further stated that, since there wasn’t enough in our account to cover the third transfer, it would simply be refused. We’d get hit with an NSF fee but, given the circumstances, they’d go ahead and waive it.
As of this writing, our banking situation still hasn’t been resolved. The third deposit is showing at Bank A, but the third debit has yet to hit Bank B. In other words, we’re currently sitting on a bunch of extra money. Great new, right? Well…
Resolving bank errors
As it turns out, even if a mistake such as this is entirely the bank’s fault, you’re not allowed to keep the misdirected funds. And if you try to do so, you might wind up getting yourself arrested. Seriously.
Here are three examples: one, two, three
When your bank figures out their mistake – and they eventually will – you’ll have to give the money back. Either that, or they’ll take it. Perhaps without warning. Thus, your best defense is to simply notify them of the error and leave the funds in place until things get straightened out.
Have you ever dealt with a bank error such as this?
Disclaimer: Discover is a paid advertiser of this site.
Reasonable efforts are made to maintain accurate information. See the Discover online credit card application for full terms and conditions on offers and rewards.
Modified on September 13th, 2010 - 9 Comments
Filed under: Banking
About the author: Nickel is the founder and editor-in-chief of this site. He's a thirty-something family man who has been writing about personal finance since 2005, and guess what? He's on Twitter!
Related articles...
» Bank Error in Your Favor?» IRS Error in Your Favor
» One Year Ago This Week (April 15th – April 21st)
» Carnivals – Week of 04/24/06
» Obsessive Compulsive Checkbook Balancing
» Letter From the IRS – We Got Audited
» From the Archives (April 13th – May 3rd)
» Bank of America Online Banking Annoyance
Was this article useful? Please sign up to receive our content via e-mail:
9 Responses to “How to Handle a Bank Error in Your Favor”
Leave a Reply
Top Cards by Category
The new Discover it card is out to change the way people think about credit cards. No annual fee. No overlimit fee. No foreign transaction fee & no pay-by-phone fee. No late fee on your first late payment. And Discover won't increase your APR for paying late.*
Bonus Miles: Earn 30,000 bonus miles toward Award Travel after you spend $500 on the Card within the first three months of Cardmembership. Earn As You Spend: Get 2X miles on Delta purchases and 1X miles for all other eligible dollars spent.
The new Discover it card is out to change the way people think about credit cards. No annual fee. No overlimit fee. No foreign transaction fee & no pay-by-phone fee. No late fee on your first late payment. And Discover won't increase your APR for paying late.*
The new Discover it card is out to change the way people think about credit cards. No annual fee. No overlimit fee. No foreign transaction fee & no pay-by-phone fee. No late fee on your first late payment. And Discover won't increase your APR for paying late.*
The new Discover it card is out to change the way people think about credit cards. No annual fee. No overlimit fee. No foreign transaction fee & no pay-by-phone fee. No late fee on your first late payment. And Discover won't increase your APR for paying late.*
The new Discover it card is out to change the way people think about credit cards. No annual fee. No overlimit fee. No foreign transaction fee & no pay-by-phone fee. No late fee on your first late payment. And Discover won't increase your APR for paying late.*
Treat yourself to the gold standard of The Business Gold Rewards Card(R) from American Express OPEN which includes $0 introductory annual fee for the first year, then $175. This charge card can supercharge the way your business earns rewards with three times points on airfare purchased from airlines, two times points on purchases at US gas stations up to $100,000 in each category per year, then 1 point. Terms and limitations apply.
The new Discover it card is out to change the way people think about credit cards. No annual fee. No overlimit fee. No foreign transaction fee & no pay-by-phone fee. No late fee on your first late payment. And Discover won't increase your APR for paying late.*
- How to Become a Millionaire
- How to Get Out of Debt
- The Best Dollars I've Ever Spent
- How Our Estate Plan is Structured
- How We Paid Our Mortgage In Less than 10 Years
- Money Making Ideas
- How to Manage Your Asset Allocation with Multiple Accounts
- Consumption Smoothing - Save While the Saving's Good
- How to Save on Groceries
- How Much Life Insurance Do You Need?
- Eleven Great Books About Money
- Dave Ramsey is Bad at Math
- Dish Network Customer Service SUCKS
- $8,000 Homebuyer Tax Credit
- Pay Off Mortgage Early or Invest?
- How to Claim the First-Time Homebuyer Tax Credit
- Termite Control: Sentricon vs. Termidor
- How Much Should You Pay a Babysitter?
- Reduced Credit Limits? Share Your Experience
- Ethanol Blended Gas = Lower Mileage?
- $15,000 Homebuyer Tax Credit
- Buying Furniture off the Back of a Truck
- Will Mac OS X Lion Kill Quicken 2007?
How to save money on insurance
- How to help your family after you are gone
- Will Social Security be gone before I retire?
- Refund, or no refund?
- This battle of the sexes has no winner
- What to look for when buying an energy-efficient home
- The hidden savings in a rent payment
- How to save money on vacations using social media and new technologies
- How to budget without regular paychecks
- What do you do with your windfalls?
- Don't believe the bull
September 10th, 2010 at 4:40 pm
I’m totally on board with getting to the bottom of ANY mistake (in your favor or otherwise). It always gets resolved – just a matter of time.
I’ve dealt with this once, too, and called in the error. They didn’t really “thank” me, but it was much cleaner and easier to get it resolved this way.
September 11th, 2010 at 6:45 am
Would it be unethical to stick the money into an interest-bearing account while you wait? Granted, it would probably get resolved too fast for you to make any serious interest, but it might buy a coffee at Starbucks or something.
September 11th, 2010 at 10:23 am
Hmmm…. not sure if it would be unethical, but one issue with that is if and when the bank figures it out they probably won’t write you a letter asking for the money back. They’ll probably just hit the account for the $$ and, if there isn’t enough there, start hitting you with overdraft and other fees.
September 11th, 2010 at 11:21 am
That’s pretty much a given that any bank will withdraw money from one’s account if it isn’t theirs, legally. I have had that happen and simply “sit on it” until the bank realizes their mistake. I make no attempt to try and claim what isn’t mine to begin with. It’s easier that way. Most of the time it isn’t in there long enough to earn interest.
September 11th, 2010 at 11:47 am
I had that happen the other day i thought, only it wasn’t the banks mistake my insurance company credited my account because they need a full payment and not a partial payment, so anyway I spent it because it was mine.
September 13th, 2010 at 12:55 pm
I have seen plenty of bank errors both in my favor and not. They (whom ever they are) have always corrected it with out a phone call or any warning what-so-ever. It is best to keep it in the account or at least enough float to cover it at all times. I have not always been able to get fees back if I was charged as a result.
September 13th, 2010 at 2:30 pm
I once had a ~$2200 bank error in my favor.
It’s been a long time so the details are hazy, but after several months of phone calls and trips to the local branch trying to convince them they made an error, I gave up.
The funny thing is, unless you buy/invest specifically with that very money, over time it just disappears!
September 15th, 2010 at 2:57 am
Oh please! You’d never get convicted for something like this. For you to go to jail the bank would have to show that you intended to defraud them when you took your initial actions in ordering the transfers. Of course i’m not a lawyer, so I encourage everyone to consult one regarding this question, & pay their inflated fees to get their “opinion” on this matter.
February 9th, 2011 at 6:53 am
whell i put on my acc. 2.500 and i cheked the saving book i saw 25 and few zero�i wasn�t worried, few days later i realise that it was writen 25 000 , one zero more till now i didn�t chek again the account i left the situation like this thinking that the bank will solve the situation .the thing is that i need so much this money �i think to take them out and when they realise and whant it back �to pay it monthely back! any opinions ? (escuse my english)