Bank Error??

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butterfield

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Looks like my bank made an error in 2005 when I purchased a bank draft. They debited my account by substantially less than the draft amount.
At this time I had a lot going on refurbishing a house and was paying a lot of people by draft and didn't notice.

They want to meet me and discuss this - just wondering where I stand on this?? Anyone had a similar experience ??
 
How much are we talking about here - 10's, 100's, 1,000's, more?

As to where you stand, I think at their mercy, if what they allege is what happened.

If its a large amount (different from everyones perspective) ask them for an interest free loan over the next 25 years to pay the money back.
 
You still owe them the money but the mistake is theirs. I would suggest negotiating a repayment schedule to suit you. That way they get paid but you are least put out by it.
 
Key phrase "looks like" - you will need prima facie evidence to prove the assertion.

Suggest that you invite them to meet you in a local hotel/cafe, not in the bank. Tell them that you can't come into the bank but would be willing to meet elsewhere. Their response will tell a lot. Don't try to explain - you are in negotiation phase and you will need some negotiating points.

Now here's the contentious bit (morally/ethically you owe the bank) but in the real world you don't and a "good" advisor will make it work.

Good luck
 
Orga said:
Now here's the contentious bit (morally/ethically you owe the bank) but in the real world you don't and a "good" advisor will make it work.
Click to expand...

What do you mean by this? In the real world surely the OP does owe this money.
 
I think what Orga means is because it was a draft, there is nothing to stop the OP disputing what was actually paid and/or debited. A draft should not be handed over until it is paid in full, be it in cash or debited to account or whatever. Kind of like checking your change before leaving a shop.

I am not sure where the Bank would stand on this legally and it might be worth taking such advice.

Having said that, if you know you owe it, pay it, but do so certainly on an interest free option over a term you can afford, if its that big an amount.
 
What I mean is the OP sought to purchase a draft and tendered payment, payment was accepted, the draft was exchanged and the transaction concluded. Now, 3 years later the vendor is seeking further monies. As an analogy, imagine that 3 years ago you were in a shop and bought a jumper. Now, 3 years on, the shopkeeper wants you to pay further monies because he believes that he didn't charge you enough at the time even though he accepted payment and gave you the goods.
 
Orga makes a very interesting point. A draft is effectively a "product" you are purchasing from the bank. So if the standard contract rules apply...the op offered to purcahse, the bank accepted & the consideration was agreed (ie -the amount on the draft, rather than the amount taken from the a/c). From other posts recently about DD's coming 6/8 months later...it appears that they have up to 6 years to seek the money.
I think ultimately you will have to pay over the money, but I reckon, as already suggested, you should have a good opportunity to negotiate the terms of the repayment.
As an aside - I wonder would they agree to meet you at a time and/or at a place that suits you as I don't see why you should have to take time off work or travel to help them rectify their mistake?
 
Thanks for all replies they have helped me decide what to do, I think Orga made an interesting point .. like if a price displayed is wrong, they are legally obliged to honour it. (Amount involved is approx 20k). Anyway I know I owe the money, though its 3 years ago and I had completely forgot about it as was handling a lot of money at time (large mortgage / refurbishment project) at the time. Think the point about meeting them neutrally is good as I won't talk on the telephone to them anymore as I think they could be recording it !!

Spoke to Financial Regulator who says I should deal with head office and get a loan over a long period which should be interest free.

Would welcome any further comments ?
 
I know I (and the Financial Regulator - exalted company) suggested the long-term interest-free loan, but how does borrowing over a long term sit with you, and also how might that effect your future creditworthiness?
 
"(Amount involved is approx 20k)."

Oh, dear god in heaven........................

You know what? You owe the money, that appears to be undisputed. If the bank sued, they would recover. Its a mistake, nothing else. It is not offer, acceptance and the conclusion of a contract.
You have had the benefit of the 20K for three years - think of it as an interest free loan.

By all means negotiate the method of repayment but "a "good" advisor will make it work." is just a nonsense statement.

If I was advising you, I'd be saying how are you fixed for paying it back, can you pay it back in one lump sum or do you ( genuinely) need time? I would not be playing or advising you to play, silly buggers.

mf
 
I would certainly seek legal advice on it. It would look like they know they are on shaky ground.

If you were to go back to the Bank now and say, you left me €20,000 short three years ago, what would they say to you? I would like to think that if they were over a certain amount, that they would return the funds.


If you are meeting with anyone from the Bank, its good advice to meet in a neutral place. Also, do not go alone, have someone there as an independent witness (not to say anything). I would be surprised if the Bank do not do this from their side. I would not make any suggestions, just see what they are putting forward and then go away and seek legal advices on it.

Morally, if you know 100% you owe it, then pay it, mistakes do happen with human error and I am not immune. Legally, I am not so sure.
 
" Legally, I am not so sure."

Legally, OP owes the money. End of story. While it would be embarrassing for the Bank to sue and have the problem made public, they must account for the money. They would succeed in a legal claim.

mf
 
mf1 said:
While it would be embarrassing for the Bank to sue and have the problem made public, they must account for the money.

mf
Click to expand...

What I can't understand is how they accounted for the shortfall in 2005.

surely when they were cashing up the day the op got the draft they'd have noticed the €20K shortfall?

If it were me and I knew for definite I owed the money I'd feel morrally obliged to pay it but would definitely negotiate something. Over 25 years with substantial discount if repaid sooner.

The Op states they were handing large sums at the time and didn't notice the discrepancy but surely €20K not debited from your account would be something you'd notice so my advice to the Op is be 100% sure there was actually a €20K difference - don't just go on the Bank's word
 
Thanks again everyone and to answer I am not now able to repay all in lump sum (have large mortgage and struggling with it) so will go route of long term loan

Wondering should I seek independent legal advise and have my solicitor negotiate for me on this .... or just go along with long term loan option and sort it out myself ..... am a bit nervous of dealing with them on the issue as its obviously something I am not familiar with and afraid I might make a mess of things somehow.
 
OP here again - would also say the only reason it has come up with them now is that the draft was presented for payment and I wonder also as someone said why it did'nt show up somewhere in 2005 in their accounts??
 

If you do get legal advice make sure you're not out of pocket for it. Factor the cost in to what's repaid
 
Hire a negotiator and get him/her to negotiate a settlement. It could save you alot of money.
 
Bond 007 - by negotiator do you mean a solicitor or maybe an accountant ??

I am certainly wary of meeting with them as I somehow feel that they will have the advantage over me as they are a big organisation with plenty of advisors etc.
 
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