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Saturday, Sep 19, 2020

Pensioner lost £193,000 inheritance after getting one digit wrong on sort code

Pensioner lost £193,000 inheritance after getting one digit wrong on sort code

A disabled man lost his £193,000 inheritance when a single mistake in his sort code led to the money being paid to someone else – who refused to give it back.
Peter Teich, 74, supplied his solicitor with his correct name, address and Barclays account number, but got one digit in his sort code wrong.

He realised the error when his sister called to tell him she had received her share of their father’s estate, but nothing had gone into his account.

On phoning the bank it emerged the money had been paid to another Barclays customer in the same area with an identical account number but a slightly different sort code who refused to return it.

To make a bad situation worse, Barclays, who Mr Teich claims knew where the cash was, said they were unable to return it.

They instead refunded him with a ‘small token gesture’ of £25.

‘Barclays insisted that I bear the full and sole responsibility of pursuing their own dishonest customer’, Mr Teich told The Guardian.

‘I freely acknowledge my mistake in this unhappy saga: I provided the sort code of the wrong Barclays branch.

‘But my error fades into insignificance when considered in the context of Barclays’ conduct.’

Mr Teich says he was left to try and claw back the funds by himself.

After spending £12,000 on court fees he finally obtained the other customer’s name and took it straight to the high court to get a freezing injunction – for a further £34,000.

The court eventually ordered the customer to repay the money and Barclays later agreed to reimburse Mr Teich’s £46,000 expenditure in full along with an additional £750 compensation.

‘It could have taken Barclays a few days to recover the misdirected funds, but instead they did nothing,’ he said.

Barclays said in a statement: ‘It is evident that on this occasion we have failed to meet the high standards that Mr Teich can expect to receive from Barclays, and for this we have offered our sincere apologies.

‘After taking a closer look at this situation, we can confirm that Mr Teich can expect the fees he has incurred to be refunded in full with interest, together with a payment for the distress and inconvenience this matter has caused.’

The error never would have occurred if banks in the UK matched sort codes with the account holder’s names.

But they don’t. Instead, payments are processed using the sort code and account number alone, regardless of what name is attached.

The banking industry has promised to introduce name checks from March next year, aimed at cutting down on so-called push payment scams (APP) which lure people into sending money to the wrong account.
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