How to recover lost cash
23 Apr 2019
Ever made an electronic transfer only to discover later that you’ve sent your money in the wrong direction?
Mistaken transactions happen more often than you may think, particularly when we’re rushing through our internet or mobile banking tasks. Someone types in a BSB or account number incorrectly; the wrong number is provided by the recipient; or the wrong payee is selected from our list of payees in our internet or mobile banking.
Australian Securities and Investments Commission (ASIC) data found about 83 per cent of mistaken transactions during a three-month period in 2015 were the product of incorrectly entering account details.
Fortunately, the voluntary ePayments Code provides some protections for people who have tripped up when making a transaction. Most financial institutions and some payment services agree to adhere to the Code.
It sets down a process that financial institutions agree to follow if a customer needs to retrieve money they’ve paid to the wrong person or organisation.
First, you have to be aware of it. Sometimes you only realise you’ve made a mistaken transaction when the person or organisation that was meant to receive the money raises the alarm.
It’s a good reason to check your bank and credit card statements on a monthly basis.
It also pays to clean up your payee list regularly. One Sydneysider was caught out when he mistakenly transferred his monthly rent to a real estate agency connected to a previous tenancy. The first he knew of the mistake was when the correct real estate agency contacted him to tell him his rent was 10 days overdue.
Watch your accounts
If you spy an incorrect payment, contact your financial institution immediately.
As long as the money is still in the recipient’s bank account, you’re likely to get it back if you contact your institution within 10 business days.
ASIC advises consumers to get a reference number when they report a mistaken transaction to their financial institution.
After 10 business days you should still be able to get your money back, but it may take longer. Again, it relies on the money still being in the recipient’s account.
If it is more than seven months since the mistaken transfer has occurred, the recipient has to consent to the return of your money before it can be sent back. It will depend, again, on the money still being in their account.
Aware that the payments environment is changing rapidly, ASIC announced a two-stage review of the ePayments Code in March, with submissions on the scope of the review closing on April 5.
Along with considering the effectiveness of the process for handling mistaken transactions, the regulator asked for feedback on whether the Code’s protections should be extended to small business customers.
ASIC expects the number of mistaken transactions will fall as more people use PayID. This is where people send payments using a recipient’s email address or mobile phone number rather than using a BSB and account number.
With PayID, the payee’s name is presented to confirm the transaction is being sent to the correct recipient.
In summary, by staying vigilant and following the advice above, you’ll be able to lower your chances of having cash transfers go awry.
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