I am so glad I am not the only person to have had this happen! Just last week, my bank deposited $10K into my account by mistake. They apologized and said that they would do their best to try and recover it, but I knew that wasn’t going to happen. So what did I do? Well, first of all, I reported the error as soon as possible after realizing it was an accident. Then, once they confirmed it was a mistake on their end and told me there was nothing else they could do about recovering the money – which is what happened – I moved it out of my checking account before anything bad might happen with it hanging around in there for too long. So yes, although technically you are not even supposed to have this money in your account, I did it because I knew that the bank was not going to give it back. Even then I didn’t get into any trouble. The bank investigated and concluded that they made an error so there was no shady activity on my part whatsoever.
As far as getting the money back, it wasn’t easy at first, but after some digging around I learned that if you do a wire transfer of the money from the receiving account to your checking account – which is what they told me needed to be done – and then transfer it back to your savings account, the money will automatically be considered income and you need to pay taxes on whatever amount it is. So I basically had to file taxes for $10K even though I only got around $5K of actual cash – but at least I had it all in my name!
This took so much work and time and I would never, ever do it again. It was also really frustrating to hear that the banks don’t have any legal obligation to make things easy for you when they make a mistake like this. If only!
My best advice is either not tell anyone about it or find some loophole where you can keep it without getting in trouble. $10K is a lot of money, and the banks clearly don’t want to deal with it.
I feel like this should be a criminal offence and banks should be made to return any money that accidentally ends up in your account. I mean, they have systems that are supposed to detect these things – why not just turn off the transfer and let people deal with it themselves? I am not a lawyer or a financial advisor, but I would never touch that money again.
Until the bank says otherwise, there is no obligation for them to return your accidentally received funds. When they receive an unexpected deposit of value into their customer’s account, they typically freeze the funds at first, sometimes while they conduct an internal investigation to see if it’s valid. Once they’re satisfied that the funds are no longer in dispute, they will release them back to their customer.
At this point, some banks require customers to return the money immediately. Others allow some time for the bank so the customer can use those funds until they send them back.
There isn’t an actual Federal law regarding this so it’s up to the banks to police their own policies, but most state laws require that if someone receives money through mistake or fraud they must return it once it’s brought to their attention. In some cases, the bank may report a customer who fails to do so as knowingly committing a crime.
Typically, the person who accidentally received funds must return them to the bank and not keep “unjust enrichment”. If your bank account received an erroneous deposit and you fail to correct it within a certain period of time (typically 60 days), this constitutes “constructive fraud” — essentially, the funds belong to the bank and you’re withholding them. At that point, your bank may turn the issue over to the police for criminal prosecution.
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