Several tens of thousands of people woke up on Christmas Day to double wages and higher-than-expected bank balances after Santander made a mistake and deposited £130 million ($176 million) into accounts with its UK customers. Santander would like the money back now, please.
The deposit accident was the result of a mysterious “schedule problem,” according to The times, who first reported the story. The bank has confirmed that The edge that some payments have been accidentally doubled. (Santander describes it as a “technical issue.”) Those transactions include those of 2,000 companies, as well as accidental deposits into 75,000 accounts of individuals and companies like corporate Ebeneezer Scrooge who feared being generous.
The bank is now working to undo that generosity, Santander confirmed. Unfortunately for Santander, many of the deposits were made into accounts with other financial institutions, including HSBC, Barclays and others. Santander will now use a process called “bank error recovery” to collect the money, although it’s unclear how many people have already spent the money, which could make this process a nightmare for the bank.
Incidentally, it is not uncommon for large sums of money to be deposited in the wrong accounts. In April, the New York Times reported that a Louisiana woman was charged with fraud after she failed to repay $1.2 million that had been accidentally deposited into her account by Charles Schwab, who originally intended only $82.56 to go to a Fidelity account to be deposited. Kelyn Spadoni had used the money to buy a house and an SUV, among other things. She was subsequently fired from her job as a 911 dispatcher.
Meanwhile, Chase Bank mistakenly deposited $50 billion into the account of a Louisiana man earlier this year. In a statement to CNN in July, Chase Bank blamed the problem on a “technical glitch,” adding that the account was eventually back in balance.
In most cases, as with the above-mentioned blunders, funds wrongly deposited must be returned. One notable exception is Citibank’s $900 million mistake. After accidentally almost a billion dollars to hedge funds, some of those hedge funds decided to hold onto the money — and a court ruled that was fine, because of pre-existing loan terms and complicated systems Citi had for sending money.
Unfortunately, “finders keepers” probably don’t apply to the Santander crowd.