What Happens When Your Bank Account Has An Error?
We've all heard stories of people who have visited the ATM to withdraw $20 only to be given $200. Some of us know people who have logged into their checkingE20-500 account online only to find that their employer has mysteriously deposited too much money. What happens in these situations? Does the newly discovered money belong to the recipient?
In this article, we'll explore two common circumstances in which an error is made in favor of the bank customer. We'll also take a look at what happens afterward.
Mysterious Checks
Believe it or not, a lot of people receive checks in the mail by mistake each year. Because many of us lead such busy lives, there's little time to investigate their source. In cases where the amounts are small (i.e. $10 or $20), depositing it usually won't cause too many problems. However, there have been occasions in which checks worth millions of dollars have been delivered to people in error. By law, the money does not belong to the recipient. If it is spent, those people can be sued for theft and fraud.
If you receive a large check in the mail for which you don't recognize the source, deposit it into a separate savings or money market account. Don't spend it. When the rightful owner contacts you, you can negotiate ownership of the interest earned.
Payroll Mistakes
If you receive your paychecks by direct deposit, one slip of the finger by someone in your employer's accounting department can result in a massive windfall. Again, don't spend the extra money; the law says that it doesn't belong to you. If your employer notices the mistake within five business days, the extra funds E22-275can be removed from your bank balance without your permission. If they don't recognize the mistake within five days, they can deduct the money from future direct deposits.
In some cases, especially those involving enormous windfalls, employers will work out a payment plan with the employee. It can take months or years to pay the unearned money back. Making matters worse, taxes may have already been taken out of the original direct deposit. You'll be able to adjust your future taxes to make up for the mistake, but it's inconvenient and takes time to do so.
It's Not Your Money
The bottom line with errors in your bank account is that extra money that you've received by mistake doesn't belong to you. If you spend it, you can be sued. Criminal charges canEVP-100 be brought against you and your wages can be garnished. So, if you receive a mysterious check or find that your employer has deposited too much money into your account, do what you can to fix the problem immediately. It may be tempting to spend the extra cash, but doing so will likely come back to haunt you.
In this article, we'll explore two common circumstances in which an error is made in favor of the bank customer. We'll also take a look at what happens afterward.
Mysterious Checks
Believe it or not, a lot of people receive checks in the mail by mistake each year. Because many of us lead such busy lives, there's little time to investigate their source. In cases where the amounts are small (i.e. $10 or $20), depositing it usually won't cause too many problems. However, there have been occasions in which checks worth millions of dollars have been delivered to people in error. By law, the money does not belong to the recipient. If it is spent, those people can be sued for theft and fraud.
If you receive a large check in the mail for which you don't recognize the source, deposit it into a separate savings or money market account. Don't spend it. When the rightful owner contacts you, you can negotiate ownership of the interest earned.
Payroll Mistakes
If you receive your paychecks by direct deposit, one slip of the finger by someone in your employer's accounting department can result in a massive windfall. Again, don't spend the extra money; the law says that it doesn't belong to you. If your employer notices the mistake within five business days, the extra funds E22-275can be removed from your bank balance without your permission. If they don't recognize the mistake within five days, they can deduct the money from future direct deposits.
In some cases, especially those involving enormous windfalls, employers will work out a payment plan with the employee. It can take months or years to pay the unearned money back. Making matters worse, taxes may have already been taken out of the original direct deposit. You'll be able to adjust your future taxes to make up for the mistake, but it's inconvenient and takes time to do so.
It's Not Your Money
The bottom line with errors in your bank account is that extra money that you've received by mistake doesn't belong to you. If you spend it, you can be sued. Criminal charges canEVP-100 be brought against you and your wages can be garnished. So, if you receive a mysterious check or find that your employer has deposited too much money into your account, do what you can to fix the problem immediately. It may be tempting to spend the extra cash, but doing so will likely come back to haunt you.
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