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Who Pays for this Error?
Answer by Randy Carey, BOL Guru
Guru Bios
Question: We received a wire transfer through the fedline for $9,000.00 from the sending bank. We deposited the funds into the beneficiary's account, who subsequently withdrew the funds. The sending bank is now requesting that we return the funds because the wire transfer should have been for $900 not $9,000. I say they are responsible because they erred when completing the wire transfer information by adding an extra zero. What are your thoughts?
Answer: Wires are basically final at the time they are sent. So the sending bank has an ability to request that the wire be returned and if the money was still there - you could honor the request (although you have no obligation to do so). However, since the money is gone - the sending bank will be on the hook for the loss.
First published on BankersOnline.com 1/16/06
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