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What to do if you Transfer Money to Someone in Error

By Dipo Olowookere

Errors are what people make sometimes unconsciously and at times, cannot be avoided. However, what is important is the step taken to remedy mistakes.

In the past, people go to the bank to send money to a beneficiary, but nowadays, there is no longer a need for that as money can be transferred to a beneficiary via the mobile phone.

However, there are times when money is sent to a wrong recipient and in some cases, the receiver fails to make a refund.

Some days ago, the Central Bank of Nigeria (CBN) released a circular on the regulation on instant (inter-bank) electronic funds transfer services in Nigeria.

In the document, the apex highlighted how a sender can go about retrieving funds wrongly sent to a receiver.

Where a customer claims to have made a transfer in error, the following provisions shall apply:

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10.4.1 Where the beneficiary is known to the complainant, the Sending Entity shall encourage the complainant to contact the beneficiary for an amicable settlement;

10.4.2 Where the beneficiary is not known to the complainant or a known beneficiary refused to effect a refund to the complainant, the Sending Entity having received a tenable claim from customer shall notify the Receiving Entity who shall place a lien on the amount in the account of the beneficiary and thereafter obtain the consent of the beneficiary to execute refund;

10.4.3 Where the beneficiary does not give consent, the internal auditors of the Sending and Receiving Entities shall mediate between the two customers within 2 weeks of the complaint to resolve the issue, and their decision shall be final. Accordingly, the lien on the amount in the beneficiary’s account shall not last more than 2 weeks;

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10.4.4 Where the contested beneficiary has utilized the fund such that lien could not be placed, and he/she refuses to fund the beneficiary account to facilitate refund, the Receiving Entity’s Internal Auditors shall watch-list the customer’s BVN and the Sending Entity may report the incident to law enforcement agencies.

However, the apex bank said where the wrong transfer is due to bank error and erroneously sends value contrary to customer’s instructions due to wrong account number, wrong amount, duplication, etc to a Receiving Entity and requests the reversal in writing within 14 working days of the transaction, the Receiving Entity shall oblige within one (1) business day without recourse to the customer (beneficiary) of the Receiving Entity provided funds are available.

An automatic indemnity shall be inferred against the Sending Entity making the reversal request.

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10.2.2 Where funds are not available, the Receiving Entity shall immediately notify its customer that the account was wrongly credited and provide proof of such notification to the Sending Entity.

10.2.3 The Receiving Entity shall notify the customer the consequences of not funding the account within 24 hours, which includes watch-listing in the banking industry, Credit Bureau and reporting to law enforcement agencies. The Receiving Entity shall watch-list the customer if he fails to provide fund within seven (7) days. The Receiving Entity shall refund the transaction as soon as funds are either partially or fully available.

10.2.4 The Receiving Entity shall not use the wrong credit to settle the customer’s outstanding indebtedness to it and shall not consider such credit as the property of the customer.

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Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

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