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#561 - 01/26/01 12:13 AM Who Pays Whom?
wwmike Offline
Junior Member
Joined: Dec 2000
Posts: 30
walla walla, wa, usa
Unfortunately, though it may not seem possible, this is a true story. We have a customer who has been receiving regular deposits(ACH credits) to her personal account for a couple of years and she says she didn't know it until just recently. We also have a merchant who should have been receiving those deposits to their account and they didn't complain about it. The deposits were credit card settlement credits. Now, since the personal account customer had NSF problems(even with the extra deposits), she has(with our help) become aware of all of the extra deposits and is just speechless. The credit card company has apparently told the merchant where their money went and they want it back. And of course, the credit card company thinks they are blameless.
So who owes the merchant? Does the credit card company owe the merchant and they then make claim against the personal customer? Or(as I suspect), the bank pays and then trys to get the money back from the personal customer? Obviously, neither customer was diligent in reviewing their account statements and reporting problems. Can we push a resolution between the two customers without having to play payor and collector?

Thanks(especially) if you can keep us out of the middle.

Mike Powers
Banner Bank
Walla Walla, WA

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General Discussion
#562 - 01/26/01 04:16 AM Re: Who Pays Whom?
Andy_Z Offline
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Joined: Oct 2000
Posts: 27,746
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I am not sure I can answer this. You didn't give us any idea of the amounts here and I'm not sure we want to know. But that would be an indicator of the aggressiveness one party may have with the other...or you.

Most importantly, were the funds credited to an account number specified by the sender? Was the deposit account error yours or theirs?

Andy Zavoina
Opinions stated are not necessarily that of my employer.

My opinions are not necessarily my employers.
Rules and Regs minus Relationships equals Resentment and Rebellion. John Maxwell

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#563 - 01/26/01 01:34 PM Re: Who Pays Whom?

I agree with Andy. Also most banks have a clause on the back of their statements that customers are to bring bank errors to their attention within a specified time (one year or whatever). So both customers were not reconciling their statements timely.

If you find your bank is in error I would suggest letting your bank counsel work this one out. Possibly legal would be able to work out a negotiation to lessen your loss.


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#564 - 01/26/01 02:05 PM Re: Who Pays Whom?

The merchant is not covered by the consumer protections of Reg E, so don't give in to them too quickly.

You should probably contact your regional ACH association for help with this. If the ACH credits came in with the account number and name of your individual customer, then you have no liability and you should refer the merchant to the credit card customer. If the credits came in with your customer's account number but the merchant's name, you might have had a responsibility to send a Notification of Change to the credit card company. If the credits came in with the merchant's account number and your system posted them to the wrong account, you are probably liable to the merchant, but remember that Reg E doesn't apply. I think a good lawyer could argue even in this case that the merchant had a duty to find the error sooner than they did and thus they would have to share the loss with you.

Good luck!

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