A recent article in The Guardian shows the dangers of giving the wrong account details when arranging bank transfers.
The article reports that the client was in discussions with the solicitors dealing with his late father’s estate, regarding the final distribution due to him. Once he had confirmed his account details, the solicitors commenced the process of transferring the £193,000 inheritance due to him. After confirming the details the client realised that he had given incorrect details and had got one number wrong in his sort code. The result? The whole £193,000 inheritance due to the client had been transferred to a stranger.
How did this happen? Banks only check the account number and sort code are correct and do not go further to match the account name to the account details. This means that if you are in a similar situation and you provide incorrect account details, you run the risk of the same happening to you.
To make matters worse, the stranger who had inadvertently received the funds refused to return the money and the bank (Barclays) could not force him to return it. At this point the client and his solicitors frantically contacted the bank in an attempt to recover the money. Barclays initially confirmed that the funds would be return to the client. Subsequently, the client received a letter from Barclays confirming that, as it was an error on his part, the funds would not be returned to him. To rub salt in the wound, Barclays then credited the client’s account with £25 by way of an apology for giving him the wrong information.
This left the client no choice but to commence a long, drawn out and expensive two-stage court process. This process started by applying to the court for disclosure of the name of the stranger who had wrongfully received his inheritance. Once the name had been disclosed, an application to the High Court to obtain a ‘freezing injunction’ ensued. After a lengthy court battle, the court finally ordered the stranger to return the funds. This came at a cost of £46,000 in total.
At BakerLaw we have strict processes in place to make sure our clients do not go through a similar situation. Our process involves various checks and verification steps to ensure the correct person receives their funds.
This is just one example highlighting the importance of instructing a highly experienced and qualified firm to manage any type of transfer from the purchase of a new property to the administration of a loved one’s estate.
Please note that this information is for guidance only and should not be regarded as a substitute for taking full legal advice on specific facts and circumstances.