I understand that the other account holder's sentiment might have been "it's the bank's money" at first, but I don't understand how someone could accept money that effectively belonged to someone else and was only given to that other account-holder by mistake. It's effectively stealing in my eyes. Barclay's is also at fault here because at the very least they should have reimbursed Teich the full amount. He did make a mistake, but it was a mistake that should have been caught by the bank if they just made sure the recipient's account aligned with all the information specified by Teich.
Yes it is. Just like stealing 1000 dollars from a billionaire is more defensible then stealing 1000 dollars from someone on welfare. The damage done on the former is nigh unnoticeable while the damage on the later would probably include starving without help.
If the law doesn’t protect everyone equally, then people start gaining a strong incentive to not follow the law. We can see the results of this currently all around the world with countries rioting and on fire.
In many cases protecting people equitably makes more sense. For example, some countries assess fines based on one’s income: https://en.wikipedia.org/wiki/Day-fine
Classic quote: “The law, in its majestic equality, forbids rich and poor alike to sleep under bridges, to beg in the streets, and to steal their bread.”
Equity is, in effect, code for treating some people different than other people due to immutable facts about reality. That's wrong. Equality is right. Enforcing equity is illegitimate use of the government and is an out right attack on everyone's personal liberties. I don't care if someone is rich, poor, white, brown, gay, straight, etc. The government treating someone differently (in anyway) due to who they are is wrong. End of story.
A strict view of equality can actually lead to the law treating people differently due to who they are. Consider a flat fine for speeding: pragmatically, that means that someone living paycheck to paycheck has to obey speed limits whilst a millionaire does not. That is wrong.
You have a strange definition of "differently". A millionaire doesn't get to speed, that's just ridiculous. They'll be stopped, inconvenienced, and have points on their license, and eventually lose the legal right to drive.
Treating people differently through some arbitrary definition of difference is wrong. Either we're all equal in front of the law or some animals are more equal than others. And the kind of justice you're peddling is what has set countries across the world on fire recently; the uneven application of the law.
[Edit] I don't think I was clear. Everywhere we see special cutouts in the law, all that happens is that the more capable less scrupulous people capture those cutouts. The best we can hope to do is to treat everyone exactly the same in front of the law.
This is exactly wrong. Someone sufficiently rich will simply pay a team of lawyers to challenge any points on technicalities. And they'll probably have a foreign licence, which makes a ban harder to enforce.
"Equal in front of the law" actually means that financial penalties should be progressive in the same way taxes should be. Some countries actually do this, and they're not on fire.
The point is that by ignoring people’s circumstances, we are creating special cutouts. In the speeding example, the “more capable less scrupulous people” capturing the cutout are those who can afford to not care about the fine.
What are circumstances? How do we measure those? What is fair? And most importantly, how do we keep the people who are better at life from capturing those cutouts like they do in 99.9% of the times there are cutouts? You may think you can create a Byzantine set of rules to make life perfectly fair, but you'll just create a framework for someone unburdened by ethics to win, as we see basically everywhere this is tried.
Why do you keep speaking in generalities when I’ve given a concrete example? With flat fines for driving violations, we’ve created a framework for relatively rich people unburdened by ethics to ignore those laws. In what way is making fines proportional to one’s income less fair or more vulnerable to exploitation?
I think you kind of prove the previous post's point though. As you said, to the millionaire all of that is just an "inconvenience". Even if you assume that they couldn't fight it in court, loosing their license is still just a slightly larger incontinence as they can just hire a chauffeur. Now to someone else, those fines could mean not being able to afford the basics like food and medical needs. Not being able to pay those fines could (and does) lead to further fines/fees and jail time, loosing homes, jobs, etc. How exactly does a punishment qualify as equal treatment under the law, equality punitive, when to one person it is at worst and inconvenience, and to another can destroy their life?
How would it not be treating "everyone exactly the same in front of the law" to just say that fines are assessed as a percentage of income and/or net worth?
All of that said, personally I wouldn't extend this all the way back to the original argument about theft though, stealing $1000 is the same regardless who you steal it from, at least as far as the law should be concerned. I could see a moral difference, but the law often does not (and can not) make moral distinctions. It could however make reasonable distinctions in the application of the punitive aspects, as it sometimes does in terms of jail sentencing.
This depends a lot on what the intended effect of the law is.
The cost of risk externalized by one person speeding is about the same, modulo driver skill and location and whatnot; it is not very sensitive to rich the driver is. If the goal of the law is to impose enough additional risk of a fine to compensate for the externalized risk, then it makes perfect sense that millionaires don't need to obey speed limits--as long as they can pay up.
If the law is intended as a deterrent, this obviously isn't working.
Fines are not related to the externalised cost of speeding, because the externalised cost of speeding can include death and life-changing injury as well as property damage, and it's very difficult to assess a fair market price for death.
Speed limits are originally designed to reduce risk, not "compensate" for it. You can tell this is true because the victims of crashes caused by speeders do not receive proceeds from speeding ticket fines.
And this is sensible. How do you compensate a family for a dead body? You can't. So the purpose of the law should be to prevent the need for that compensation in the first place.
Mass-murderers should be treated the same as a nice man who helps old ladies cross the street?
I suspect you don't believe that, so when you say "the government treating someone differently (in anyway) due to who they are is wrong" what do you mean?
Thus you are calling for a system of fines designed and intended to punish the poor and disadvantaged harder. Forget about assessing means and circumstances. The minimum wage guy pays the same fine as a billionaire. You've just made a load of laws optional if you have enough in the bank (OK, justice systems can bring some degree of this, but via unintended consequences)
Do you believe that will have the same deterrent effect across society? I sure don't.
You're seeing "the bank" as a faceless entity, when in fact "the bank" (not sure about this particular bank, but in general) is owned by shareholders, some of whom are almost certainly disabled old ladies whose dead husband put their retirement savings in bank stocks because those were considered to be a safe investment.
If enough people steal from "the bank" under your theory, the old blind lady winds up eating cat food and not being able to pay her rent because the bank is no longer profitable.
That doesn't sound quite as "defensible", now, does it?
Note that things like banks and insurance companies (another favorite whipping boy) do tend to have their stocks owned by things like retirement funds, precisely because they are considered low-risk investments with a safe (albeit small) yield.
I'm not seeing the bank as a faceless entity. My point about the comparison with two people should clue you in on that. Your theory about if enough people steal from "the bank" doesn't hold any water since if that happens it's proven that the government will swoop in and save the bank as happened in the 2008 financial crisis. That's not even to say the vast options banks have to detect stealing if it would become such a huge problem. A person on welfare has little option.
It's simple to me. a single person stealing from a bank incurs a lot less suffering then a single person stealing from a welfare recipient. The damage done is simply not even comparable.
> it's proven that the government will swoop in and save the bank as happened
And you're also apparently seeing "the government" as a faceless entity with an unlimited amount of cash.
When the government "swoops in", it's at the expense of every single taxpayer.
I'm boggled that people are incapable of understanding this, or are in such denial about it that they feel the need to mod me down rather than debating the point.
A lot of the banks have contract terms which allow them to correct erroneous transfers (i.e. incorrect deposits to ones account without ones approval), so waiting for a court order would not be necessary.
It took the guy 2 years and nearly 50 thousand pounds to get it back. The law can say whatever, but if there's no enforcement then what are you going to do? There's a good chance you can get away with it, but yes, the guy had an extraordinarily bad luck of sending the money to someone who had zero morals. I'm sure(hope?) that most people would give the money back.
In addition to that - the person who kept the money had literally no punishment for doing this. It is my understanding that they simply had to give it back and that's it. Even if they only kept it in a savings account for 2 years that would have generated a non-insignificant amount of interest(so they benefited financially from their crime) yet there is absolutely no punishment for it.
> Teich contacted the Guardian for help. We asked it to reconsider his case, and in an almost immediate U-turn, it has now agreed to pay all his legal fees, and has offered him £750 in compensation.
This is the unfortunate state of business. You’re fucked unless you can rake a company over the coals in a public.
The worst actor in this the person who refused to return the mistaken transfer. Why isn't he or she going to jail or at the least being sued for legal fees? Why does the article only talk about corporate sloppiness but not personal misbehavior? Why isn't the law changed so that people getting mistaken transfers can be identified quickly if they do not return the money?
Then it's better for the money to be lost to him than to fulfill it's original purpose? Plus they cannot make a claim to court to get it back given the context, although I'd be more worried about personal safety than court.
The original owner is much kinder than me because I honestly would have plastered the person's name who refused to return the money once I had gotten it from the courts.
Hard for me to not be a pessimist when thinking about the future because it always leads me to believe there will be a social point system like that episode on TV series Black Mirror.
That’s not what I read. They absolutely are trying to stop current criminals. Like this one,
> A high-profile Chinese businessman is on the brink of becoming a social outcast and being banned from his lavish spending habits by the courts if he doesn't pay back $21.5 million debt, even though he is the son a well-known real estate tycoon.
> Wang Sicong, the son of the billionaire owner of AMC Theaters, Wang Jianlin, was last week listed in the national database of the Supreme Court of China of debtors and defaulters with outstanding debt. A failure to pay within the given time will see him join the ranks of “discredited” people.
Actually if a large amount turns up in your account I wouldn't give it back or touch it at all. That's how you end up enmeshed in scams and money laundering. Insist others sort it out properly. Whether the person tried to spend the mistaken money is really speculative gossip, we don't really know.
I do not have evidence to the contrary. But a journalist carefully saying it is the opinion of the aggrieved party that the other person was an outright villain does not make it so. It could be true, it could be a mistake or somewhere in the middle. I don't think we will ever know.
Could that be done? With all the cheque scams, I'm guessing yes: someone cashes a bad cheque into your account, suddenly it says you have, say, 10K more money, and then you get a phone call from a "lawyer" claiming please return the money to some other account. You do so, and then the bank tells you the cheque didn't clear, they're taking 10K away from your account...
If a crypto (or other digital) currency has reversible transactions ("Undo this transaction and all the after effects"), that would be cool. So if I spent that 10K on a new Mac, after the Undo I'd have the Mac and a huge unpaid bill from the Apple Store...
1. I am sure the person will be prosecuted accordingly if a police report is filed.
2. I think the primary issue is down to cuts to the judicial system. Courts are overburdened with cases and a change in the law would do nothing to address the root cause of why it took two years.
Because then the article would be about poor Jane Slopkins, the single mother of three who struggles to make ends meet.
"That money was such a godsend for me and my family. I didn't want to touch it at first, but my son lost 5000 pounds betting on horses, and the bookies were threatening to break his legs. My daughter was failing her classes while working two jobs, with the money she could stop working and focus on her studies. She's always dreamed of becoming a reporter", etc.
Jane received this money through no fault of her own, and now that she's had to give it back, her life has been thrown into turmoil once more. And that's not all, she is now facing prison for a non-violent crime she had no idea she was committing.
This is why all account numbers should end in a 6 to 12 digit checksum verification, to protect against human input error. If this bank had implemented this simple precaution then the entire situation would have never occurred.
It was actually the "same" account number at a different Barclays branch. The account-holder may even have been largely unaware that the sort-code was a critical part of the unique identifier for his Barclays account.
Yeah, so the problem is that the account number plus short code had no checksum validation. This is the banks fault for implementing a rubbish account system. A proper system would look more like this sudo code:
where 1234567890 is the account number, 1234 is the short code, and then 6 characters are typed in at the end are a checksum.
The short code is unique. So if you type in the correct checksum but not the correct short-code the fully-qualified unique identifier does not pass the validation step. Like-wise, if you type in the correct short-code but not the checksum then the unique identifier also does not pass the validation step. Thus, the user is protected against typing in an incorrect short code.
6 digits are far, far too extreme from a usability perspective. We have IBANs as world wide unique account identifiers. They are very unwieldy with up to 34 digits, depending on country. And only 2 of them are checksum digits. Most mistakes are one or two wromg digits or missing/extra digits and that can be caught with 2 properly designed checksum digits.
UK Sort Code + Account Numbers _do_ have check digits (Its not precisely a check digit as such: they have rules that they have to obey to be valid). Because of the age of the system, there isn't one _consistent_ rule for all sort code and account numbers, but instead a document listing the various methods and a couple of tables saying which rule(s) to apply and how
In most cases the sort code is included in the checksum
This system already exists and is called the IBAN (although it has only two checksum digits, mod 97). I thought it was used for all bank transfers in the EU now, but apparently the old system is still in use in the UK.
Almost all the UK banks still use sort code and account for transfers, even though the accounts have IBANs.
It is often possible to perform foreign transfers using destination IBANs, but they seem to prefer (or require) the traditional approach for UK Sterling transfers.
I can understand why they retain the old system, but it would be useful if they in addition offered the ability to specify the target via IBAN for domestic transfers, since they already do for transfers to the rest of the EU.
Even when doing a SWIFT transfer, the IBAN (if one has it) is useful.
I do not understand why they retain the old system? What possible good effect can this have?
Japan has the same system of sort/branch codes and account number, but when I enter those here the recipient name is automatically filled out, making incorrect transfers pretty much impossible (unless, I guess, your mis-entered transfer to Mr. Sato is transferred to a different Mr. Sato instead)
It's baked into various systems, protocols and conventions? Sweden and other EU countries which didn't adopt the Euro also retain their traditional account numbering systems
A part of the Eurozone transition was that all local systems were replaced by SEPA SCT/SDD, which are inherently IBAN based. But SCT/SDD only apply to Euro transfers, and so in non-eurozone locales the existing infrastructure and nomenclature is retained
> Japan has the same system of sort/branch codes and account number, but when I enter those here the recipient name is automatically filled out, making incorrect transfers pretty much impossible (unless, I guess, your mis-entered transfer to Mr. Sato is transferred to a different Mr. Sato instead)
There is a Confirmation of Payee system coming soon in the UK (which most of the large banks have, unfortunately, delayed). It works slightly differently: it will compare the name, but not _generally_ tell you the name of the recipient because that comes with privacy concerns
Many UK banks will issue IBANs (they are trivially calculated from the sort code and account number anyway), and payments can be made to IBANs - but for transfers within the UK, there is no need to provide an IBAN.
The issue here was not the account number being wrong, but rather the combination of sort code and account number being wrong - for which there is not necessarily a checksum digit covering the pair.
Most UK IBANs can be trivially derived from the sort code and account.
I have some accounts where the sort code and account are not directly embedded in the IBAN. So for those possibly there is a mapping table one could refer to.
You can _always_ derive it. For any case where you can't, something funky is going on (perhaps a common holding account IBAN where customer-specific information is encoded in the reference. I've seen this occasionally from TransferWise and Revolut)
im glad this all worked out in the end. i also find it sad that the sod who received the funds couldn't be bothered to avoid pillaging someone else's inheritance, but given my general misanthropy i'm not surprised
Nice to see the legal system working mostly as intended. The person who received money by mistake has to return it by law.
Given the specificity here, have to sue Barclays to find out whom did the money go to. Barclays cannot take customer money without a court order or disclose customer identity. Then sue the person to get the money back.
I think the lesson here is that person who tried to keep the money is a dickhead. Moreover, it's really lucky that he didn't burn it all and was insolvent.
I don't understand how this isn't prosecuted as criminal theft. In the US it's not legal to keep something clearly sent by mistake, and it's not even legal to keep a valuable thing you find in the street, if the owner comes looking for it.
It could be fraud by false representation (i.e. falsely representing to the bank that it was a legitimate and intended transfer the account holder was expecting to receive) per S2 of the Fraud Act 2006, but it's typically easier to prove theft under S1 of the Theft Act 1968 since that doesn't require any false statement to be made.
(a)a wrongful credit has been made to an account kept by him or in respect of which he has any right or interest;
(b)he knows or believes that the credit is wrongful; and
(c)he dishonestly fails to take such steps as are reasonable in the circumstances to secure that the credit is cancelled
Did he dishonestly fail to take reasonable steps? From the article, it seems that the bank asked him if they could take the money back. It would seem to me to be a reasonable step for him to say "yes". Did he dishonestly do so? Tricky one; Theft Act 1968 specifies what dishonesty is not, leaving it open to a jury to decide what it is.
Theft Act 1968 says the following cases are NOT dishonesty:
(a) if he appropriates the property in the belief that he has in law the right to deprive the other of it, on behalf of himself or of a third person; or
(b) if he appropriates the property in the belief that he would have the other’s consent if the other knew of the appropriation and the circumstances of it; or
(c) (except where the property came to him as trustee or personal representative) if he appropriates the property in the belief that the person to whom the property belongs cannot be discovered by taking reasonable steps.
None of those applies, so it's definitely possible that he did act "dishonestly" under the Theft Act 1968, in which case yes, this is theft.
HOWEVER, there is an incomplete definition of "wrongful credit" here that could throw a spanner in the works:
A credit to an account is wrongful to the extent that it derives from—
(a)theft;
(b)blackmail;
(c)fraud (contrary to section 1 of the Fraud Act 2006); or
(d)stolen goods.
One legal interpretation of "to the extent that" is simply "if", in which case this was NOT a wrongful credit to an account, and this entire section of the Theft Act 1968 ceases to apply.
HOWEVER, it's not "if and only if"; could one argue that this was a wrongful credit? Well, it was certainly wrong in that the account that was credited was not the intended account. I suspect a good lawyer could reasonably argue this, but I don't need to go looking for case law; in this case, the court agreed that the money must be returned, which I think is itself case law supporting the idea that the recipient was in the wrong.
I am not familiar enough with British slang and legal terms. Not sure whether an unintended bank transfer qualifies as a "credit", let alone a "wrongful credit".
Either way, it's still a civil case at the beginning. Have to go to court with the bank to formally request a return and establish the identity of the holder.
By the way I was thinking of another Act that says you have to return stuff sent to you by mistake, can't seem to find it again.
Yes, it does. A bank transfer credits the account of the recipient.
In this case, is it a "wrongful credit"? Arguably, yes — it's theft per S1(1) of the Theft Act 1968 since the recipient intends to keep it and appropriates the rights of the owner in doing so.
The closest Act I can find regarding returning stuff sent to you by mistake is the Consumer Rights Act 2015, specifically S25 which says that if the trader sends you a quantity of goods greater than you were expecting, you may accept them but you must pay for them at the contract price—you cannot keep them for free: http://www.legislation.gov.uk/ukpga/2015/15/section/25
The original Act was the Unsolicited Goods and Services Act 1971 but the section on the right of recipients to keep unsolicited goods has been repealed accordingly.
It is theft — S3 of the Theft Act 1968 covers the meaning of "appropriates" as follows:
"Any assumption by a person of the rights of an owner amounts to an appropriation, and this includes, where he has come by the property (innocently or not) without stealing it, any later assumption of a right to it by keeping or dealing with it as owner."
In this case, the person innocently came by the money as a result of a mistaken bank transfer. They then proceeded to withdraw it from their account and presumably spend it: thus keeping it and/or dealing with it as the owner would—meaning they appropriated it accordingly.
All other elements seem to be made out here too: A person is guilty of theft if he dishonestly appropriates property belonging to another with the intention of permanently depriving the other of it; and “thief” and “steal” shall be construed accordingly.
Minor point, the article doesn't specify whether the money was withdrawn or used.
The conclusion hints that it was returned, without making it clear. In the absence of better information, I would assume that it wasn't used or withdrawn, it couldn't have been returned if it were.
"The banking industry promised that from mid-2019 name checks would be carried out when customers sent money to other people"
Wow. So far behind.
"Barclays said it asked the person who received the cash for permission to return the money, but he refused."
There is nothing to refuse. The law in my country would be pretty clear about this. Honestly, just to prevent the guy withdrawing and spending it, it would very likely pay him a visit. But that is me.
Okay but say I receive money from you, I send you goods or services, then you fraudulently claim to the bank that the transfer was erroneous. The law is as it is because arbitrating disputes between customers is correctly a matter for the courts not for banks. In normal circumstances the recipient would return the money and not try to steal it. The entire problem here is because the recipient fraudulently disputed the return of the money.
The better resolution is to make sure such errors don't happen in the first place.
This is kind of shitty, but once the situation occurred (due to the stupid and IMHO inexcusable situation of "An oddity in Teich’s case is that Barclays also appeared to have identical account numbers for two different customers") there really aren't good solutions of the (unintended) recipient disputes the reversal and claims that that's money intended for them.
All the things he initially asked Barclays to do were refused not because they didn't want to do that, but because Barclays can't do that. They can't return the money without a court order (in these particular circumstances the payment was "executed correctly" according to the legal criteria, because the payment was intended to be sent to that account number and was credited to the matchign account number, so any uf the more common justifications of error-fixing can't apply. But the payment laws pretty much implicitly assume that the account numbers are unique, and they weren't in this case), so if the recipient disagrees, then either it goes to court or the money stays there. Furthermore, revealing the account holder's identity would be a crime under banking secrecy laws - again, a court order was needed for that, it's not something that Barclays is allowed to do at their discretion.
What does seem ugly is the obscene legal costs - it should not take 12000 and 34000 pounds to submit a simple claim to the court that (as far as I understand) was not even contested.
There's a good chance it was a 'no win, no fee' type lawyer.
They charge extra because they know they don't get paid if they loose. Also, there was a good chance they wouldnt get paid if the recipient of the money took it all overseas, or if the 74 year old died before the issue was resolved.
Burford Capital, LCM Finance, Manolete Partners are all publicly listed companies in the UK that do this (iirc, there was a change in the law a few years ago that meant this industry really started at scale in the UK).
I have never liked the business, frankly lawyers are scummy and will (if given enough time) screw you eventually, but it exists (btw, Burford Capital are known for taking liberties with their reporting to investors...which kind of proves the point).
Barclays, knowing that they had committed to doing name checks by "mid 2019" and had to delay on their end, and knowing that this situation occurred because they gave multiple people the same account number, could have had their lawyers deal with this (or directly pay for his lawyers otherwise) instead of basically telling him to bugger off.
> I also don't see why this is a question we ask the recipient. Wouldn't it make more sense to ask the payor?
Because at that moment that's the recipients money as far as the bank is concerned - it might have been a payment for some valuable item and the payment order used as proof of payment, it might have been a gift or anything, and the beneficiary is legally protected from the payer changing their mind after the fact, the bank isn't allowed to take their money without the beneficiary's consent just because the payer wants it. There are specific legal exemptions that may apply for cases where the payer didn't actually order that payment (e.g. some types of fraud, or technical faults such as a single order getting executed twice), but they don't apply here, because they did order that payment to that account, so it pushes this situation into the same box as all the other (quite frequent) issues of the payer changing their mind after the fact and wanting the money back.
If there's a dispute and the payer claims that the beneficiary shouldn't have that money and they owe it back - well, the banks don't get involved in disputes about who owes whom what, they can only execute payments when ordered by the owner of the money or a court order resolving that dispute. It's just as with a cash payment, if someone has gotten your pile of cash because there's been a misunderstanding, or mistake, or a change of mind, or even actual fraud - you can't simply take the cash away from them if they disagree or dispute the issue, they'll keep the cash until the dispute is resolved, or possibly the police will seize/freeze that cash following due legal process.
There are very many cases where there might be a dispute between a payer and the beneficiary, someone demanding their money back for all kinds of reasons - those cases far outnumber situations like this one. We have a process for resolving disputes about money, and that involves civil claims in court. After a correctly executed payment is completed (and a payment credited exactly as the payer ordered, even if they wanted to order differently or changed their mind) it can be reversed only if the beneficiary agrees or by a court order taking the money from the beneficiary and returning it to the payer, as in this case, that's the law.
This payment was not credited exactly as the payer ordered. There was no account matching the information the payer provided, and Barclays sent the money to a different, non-matching account:
> Teich had given his correct name, address and Barclays account number in Cambridge to his solicitor – but the wrong sort code.
> At the moment, anyone wanting to transfer money is asked for the recipient’s account name, account number and sort code. However, it’s typically the case that the bank does not check if the account name is correct.
> The mistaken transfer – called “misapplied funds” in banking parlance – could not have occurred if UK banks matched up sort codes and account numbers with the account holder’s name. But they do not. A recipient’s name could be given as Mickey Mouse and the bank would still process the payment, using the sort code and account number alone.
That's the whole point, legally the payment is explicitly considered "executed correctly" if it's credited acording to the account numbers (and not the names or addresses) provided by the originator; possibly (but I'm speculating) to avoid a nontrivial number of rejected payments because of typos and variations of spellings for company names.
The other account was the unique account matching the account number + sort code (this combination is presumably what Barclays deems the 'unique account number') - so that's "executed correctly" according to "Where a payment order is executed in accordance with the unique identifier, the payment order is deemed to have been correctly executed by each payment service provider involved in executing the payment order with respect to the payee specified by the unique identifier."
The payer had also specified the name and address, but the law explicitly states that the bank is not liable for mismatches of the name or address, it's only required to execute it according to the account number. "(5) Where the payment service user provides information additional to that specified in regulation 43(2)(a) (information required prior to the conclusion of a single payment service contract) or paragraph 2(b) of Schedule 4 (prior general information for framework contracts), the payment service provider is liable only for the execution of payment transactions in accordance with the unique identifier provided by the payment service user. " is quite a mouthful but it essentially says that even if you provided extra information, that information can be ignored.
However, the article implies that Barclays did not fulfil their requirements of "(3) The payee’s payment service provider must co-operate with the payer’s payment service provider in its efforts to recover the funds, in particular by providing to the payer’s payment service provider all relevant information for the collection of funds." which does seem to require them provide sufficient information to sue the mistaken recipient to return the money.
I don’t think this is necessarily true, since account numbers are bound to people. If I transfer money to Jim, then the most important part is that it arrives with Jim, not that it arrives on account nr xxx.
What part don't you think is true? The bank only has to match on the account number and sort code by law. It's not required to do name matching (and even the proposed name matching scheme will be voluntary).
It might be important to you that the money goes to Jim, but from the bank's perspective they executed the instructions correctly.
I once took a call in our office, looking for a "mrs x y". I said sorry noone of that name here. The others come back from lunch, turns out "x y" is a legal alias of colleague "v w", and it was the bank calling.
The UK doesn't have any banking secrecy laws — protection of account details falls under the Data Protection Act 2018 but the general principle was established in common law by Tournier v National Provincial and Union Bank of England [1924] KB 461
Okay, I was mistaken there, that seems to be country-specific; and according to http://www.legislation.gov.uk/uksi/2017/752/regulation/90/ma... they should have disclosed the contact info (or sufficient information to sue) at the payer's request. That would have prevented the need for the first (but not the second) lawsuit.
Maybe some details are missing but for such a sum, maybe Barclays should have had someone in legal helpfully call the problem customer and explain that they were never going to get away with it, it would cost them more in the long run, and oh yeah, that they weren’t going to be a Barclays customer if they didn’t return the cash?
If the Solicitor had instead posted a cheque to the heir, then the problem likely would not have occurred, and if it had would have been reversed a lot sooner.
Yes, that's how it works in the UK. If you, yourself, enter someone's bank details and send them money using a bank's online interface, you are responsible. The bank can not just reverse that transaction. Best they can do is contact the recipient and ask politely.
It's the cause of millions in fraud.
So, learn from this and double, triple, quadruple check what you enter every time. It takes less than a minute and can save you from bigger headaches. Just like wearing safety goggles.
> Yes, that's how it works in the UK. If you, yourself, enter someone's bank details and send them money using a bank's online interface, you are responsible.
Except that you're not responsible. Peter Teich got his money restored using only the UK legal system.
The process was:
1. Sue the bank for the other customer's name.
2. Sue the customer who received the payment.
3. Recover from them. This recovery is (surprise!) enforcible by the bank.
If you were responsible for the consequences of sending money to an account you specified incorrectly, none of that would be possible in the first place.
Only because a court order mandated recovery of the funds. You are "responsible" in the ordinary meaning of the word for the details you input into the system therefore under its contract with you, the bank is not obliged to correct your mistake.
Obviously, when a court order compels recovery of the funds, the bank is obliged to comply.
I've been in a similar situation, and the bank was adamant they could not do anything beyond contacting the recipient. For £750, I won't bother with the legal system, so that's a loss.
I do think it's a good system, if you want to recover your money, you can go to court. Wish it was cheaper/faster/more straightforward to do that.
One can transfer a small token payment and ask the payee to confirm the amount received. If correct then transfer the remainder. It helps that my bank's site remembers the account details of recent payees.
That's a lot of effort that only protects against a fairly specific type of error. You'd still be vulnerable to phishing or to accidentally modifying the account number the 2nd time. If everybody paid their bills that way and every solicitor and employer paid their clients/employees that way, it'd be a giant mess! What? I'm not getting paid on time because they have to double check my account?
> That's a lot of effort that only protects against a fairly specific type of error. You'd still be vulnerable to phishing or to accidentally modifying the account number the 2nd time. If everybody paid their bills that way and every solicitor and employer paid their clients/employees that way, it'd be a giant mess! What? I'm not getting paid on time because they have to double check my account?
The verification would only happen prior to the first transfer of value, with subsequent transfers using the verified information.
But it makes sense for large one off payments. Send £1, phone them to ask if they got it, then send the rest. With instant payments nowadays it takes barely any more time.
People do this all the time. Mum mum did it recently paying for a used car.
Also usually the payment details are saved after the first payment so the risk of making a mistake with the second payment is low. You would reuse the saved payee.
Yes. Not sure if you meant this, but I like to send a slightly random amount without informing the payee how much. Then ask them to verify the specific amount, e.g. £1.65
>Also usually the payment details are saved after the first payment so the risk of making a mistake with the second payment is low. You would reuse the saved payee.
Exactly. A twist is my bank wipes the saved payees after a few months or so.
Paypal do it. When you hook up an account they send 5p or something, and require the transaction code number for validating the account.
Seems like if the banks cared they could add a very similar process for adding personal transfers, and mostly automate it for their customers. Except it's customer money being lost so the impetus is not there.
Nothing has changed since this happened to me, in reverse, in 1996.
18-year-old me had an account with the Halifax, then a building society. One week, £50 appeared in this account. I knew it wasn't for me, and didn't want to spend it as I knew I'd have to give it back at some point. (I'd asked my girlfriend's dad, a lawyer who worked for the Crown Prosecution Service, if I could just keep it. He compared it to someone parking their car on my driveway. They shouldn't leave it there, but that doesn't mean it becomes my car.)
I wrote – on paper, in an envelope – to the Halifax. They said they'd do something about it. They didn't, and a month later another fifty quid arrives. This went on for a few months, from memory. When they finally sorted it, I pointed out that another bank (HSBC?) was, at the time, offering a £25 'sorry, we screwed up' payment. I suggested that they might like to send me £25.
The manager wrote back and told me that as 'no inconvenience or cost was incurred by me' as a result of this error, he didn't see why he should give me £25. Looking back, this event shaped how I feel about corporations, about how the 'little guy' is treated. I was fucking furious, so I meticulously detailed all of the costs, including my time at the minimum wage of the day, and put them in a letter. I mean down to the cost of the envelopes, the stamps, and the landline calls that I'd made. Everything, itemised. It was beautiful.
I called and got the manager on the phone. I explained my stance, and read through each line of the letter I was about to send. "Do you agree that this was a cost incurred by me?", I asked after every line. He couldn't disagree. I think the total was somewhere around £60. I finished the call by saying that he'd be getting this detail in the mail, and that it wasn't a letter this time, it was an invoice. Then – oh man, I remember this – I just hung up on him.
When I was in college, someone kept leaving their car in our driveway, in a spot we had rented to a now-irate third party. The police wouldn’t tow it, but a friendly cop clued me into the procedure for claiming “abandoned” property.
I filled out some paperwork, paid a $10 fee, and the cop came back with some giant “abandoned?!” stickers that he pasted all over the car. If no one called the number on the stickers within 72 hours, the car would be mine.
Alas, at hour 70, a woman came out and started furiously scrubbing away the stickers, so I just missed getting a car. On the plus side, she never parked there again and the rent money from the parking spot covered our cable and propane bill until we moved out.
The city wouldn’t tow from private property, and a towing company wanted to talk with the actual property owner, not some kids subletting from some other kids, and he was impossible to find.
You still have to keep track of it and keep in mind how much of the total sum is not yours. That is a mental overhead and inconvenience, especially when the alien sum is a significant part of the total.
It does. What if in worst case scenario, you on on hook for something like alimony or fine payment, your accounts are being garnished, n now this unexpected money is also used for those payments??
More importantly to me (OP of this thread here), and of direct relevance to this story, is the fact that the money in question does belong to somebody. Presumably they want it! So me just doing nothing about it already feels bad.
Bad in an inactive kinda way, but nevertheless, something that I, as a good human, should feel sufficiently bad about to warrant my taking action.
What else are you supposed to do? Ignoring the deposit isn't really an option. It can cause a number of problems, and the problem will only get worse with time. For one thing, the tax man will notice a large enough deposit and start asking questions. Which means you'll have to prove they aren't your funds, probably with expenses involved. It could also screw up eligibility for means-tested programs. It also means you can't close the account, since you need to withdraw the funds to do so, but withdrawing those funds would leave you exposed to a charge of theft.
There's unavoidable headaches and potential expenses here.
If anything, the amount of shadow work foisted on customers has increased. Somehow it's a norm to have to go through a bunch of bullshit to have errors corrected and often just to get halfway decent service. It's obviously worse in industries without meaningful competition, but society in general seems to put up with it and assume that's just the way it is.
Yes - it is not illegal or even unlawful for a doctor, an insurance company, a utility like a power / phone / water company to send you a grossly incorrect bill and cause you dozens of hours of work to get them to see THEIR mistake.
If our Internet cuts out and I have to call in to get it fixed I calmly but firmly let them know that I must be fully credited for the day, pro rata.
They always have beef with this and tell me that “normally they don’t do X or Y unless A or B”. I tell them that I fully understand their position, but my position is this:
“When I hang up this phone call it will either be because you have credited me for the day that my service failed and I had to do your company’s job debugging it, or because I have terminated my service. The choice is yours but those are the only options.”
An ideal free market is one is which no coercion occurs, including state coercion like regulations and taxes, and private coercion like theft and fraud.
Colloquially, a free market refers to one in which a minimal amount of government intervention occurs. The less state intervention, the more free the market.
No, that just gives rise to corrupt capitalism. Like expecting law and order without police and courts.
Without regulation and strong intervention against problematic companies cartels, profiteering, monopoly and all the other problems of unconstrained capitalism tend to result. Standards will fall, prices will rise, deals will be done on golf courses and in (formerly) smoke filled bars against the interests of the customers.
The best markets are ones that have a clear market, and are kept free and ethical by strong and appropriate oversight (government). Needless to say there are many markets that are not appropriate uses of the market, and oversight does not work too well with a revolving door between commerce and regulator, smoothed by filthy lucre.
There’s a number of problems that can occur in markets without any coertion - e.g. principal - agent problem, or asymmetric information - that make a market less efficient and thus worse for paricipants. The job of the government is to work to prevent those, even with coertion if necessary (e.g. fiduciary laws, food standards, ...). There’s a tradeoff between too few laws (reducing market participants’ confidence in the goods/services they buy) and too many laws (increasing barriers to entry and causing monopolies).
I think it's bad to define a word for a situation in terms of what you think it takes to get there. Because that encodes your prejudices where it's not necessary.
Whenever you define freedom as "what you get when you do X" you have set yourself up for Orwellian denial of reality.
I think a good way to define freedom is "the condition of having a reasonably large number of good choices". The better and more diverse the choices, the more freedom.
> Internet providers use government regulations, not available market forces, to keep out competitors.
High initial investment cost have totally no role to play at that. Or landlords allowing only a single ISP [0]... that's just part of the market... you can always move, after all. But no, dysfunctional markets must be because of government regulation, since markets are so great that there are no other form of market failures.
Sorry, but equating regulatory capture with "government regulations" kind of triggers me. Companies obviously will use everything possible to their advantage. Including dysfunctional governments. At that point, fixing your gov might be the more important issue...
High initial investment costs (for laying fiber etc) won't stop someone like Google. What stopped Google fiber was regulatory barriers set up by municipalities to help their local ISP cronies.
> Sorry, but equating regulatory capture with "government regulations" kind of triggers me.
Regulatory capture is composed of government regulations.
> fixing your gov might be the more important issue
Well, Google isn’t blameless here. Google was also either hubristic or incompetent and thought just because they were full of smart people, could “fix” anything.
As I understand it, shallow trenching was a way to try to get around incumbent lock-in. They were trying to bypass the barriers that were raised by regulatory capture.
No they did it just for speed and cost. Once they got permission and right of way access from the city to do trenching, it wasn’t a different permit to do shallow trenching as opposed to the regular method.
I don't have any hard numbers, but I'm going to wager that regulatory capture through pole attach rules has way more impact than high initial investment or landlords.
I've experienced how local governments handle ISP regulation first-hand. I can say with confidence that it causes many, if not most, issues with ISP monopolies in suburban and rural areas in the US.
Oh so wrong. Just about all those places who privatised state utilities and brought in the market are, in varying degree, regretting it.
Take Thames water, busy playing with offshore finance plays, massively increasing profit and exec pay whilst reducing on all performance measures. Worst nationally for leaks, rate of fixing leaks, managing supply, it goes on.
"Privatizing" state utilities is not equivalent to bringing in the market. Usually privatization just means converting the government-managed monopoly to a heavily regulated, privately managed, government-sanctioned monopoly. There's no market there.
There is a market across much of Europe, a proper, functioning mature but rent-seeking market - as is to be expected from a utility.
I can get my electricity from any of the companies in the UK, same for gas, without any restriction. I can choose on price or service, regardless of where I live. Yet service standards have declined, prices have risen far in excess of inflation, and buffer overhead of generation, production and storage has declined. The national grid is more fragile than it was as a result. That's despite efforts of the grid to modernise, and provide a smart grid for renewables. It's required additional regulation to bring back a little headroom on the grid, and inadequate regulation to prevent extreme profit-seeking. The projected plans for additional pumped storage and hydro and tidal schemes have been shelved. For decades. Electric has indulged in the same banking roulette with currency plays seeking profit in preference to producing electricity.
So what part of the market is missing? None. What advantages has the market brought? For execs and shareholders, free money! For customers and the climate? More costs, poorer service.
The biggest winners? The US corporations and hedge funds who fell like vultures on the privatised companies. Oh, and the French state - their power is still significantly state owned, I think 51%. They've been able to save their tax payers money by joining in the profiteering from UK generation - one of the big 6 UK suppliers is EDF: Électricité de France.
Markets require competition. If I have to pay a lawyer thousands of dollars before I can install some solar panels in my back yard and start selling the power to my neighbors then I'm not going to do it, and if the only remaining companies who do are an oligopoly of huge players with the regulators in their pocket then you no longer have a market.
A lot of that is regulatory capture, but the other huge factor is administrative costs. Even if I can do a great job and do everything safely with no danger to anyone -- suppose I'm an electrical engineer -- then I'm still not actually allowed to do it because the rules require an electrician.
We could have simple rules -- don't electrocute people, don't start a fire -- but sometimes it will happen despite our best efforts. Then a bureaucracy doing the work will want to defer blame. A set of regulations allow that. If there is a fire but they followed the regulations, well, they followed the regulations. Not their fault anymore, even though it ought to be. But then every time something bad happens, you get another rule (even if there are five other, possibly better, ways to solve the same problem), until the rules are so complex that only a large bureaucratic entity can follow them. Having destroyed competition, we can now blame the market for the resulting badness.
Hmm, America sounds deeply broken if that's true - we don't need thousands on lawyers for solar installation here. Contact installer, arrange appointment, complete the few bits of paperwork - unless your house has restrictions on works, eg shared property or rental. Planning permission in national park areas is, I think, required.
As for the other, it pays to remind ourselves why we have some of those rules. After years of assorted homes and offices, seeing the horrific electrical or plumbing ideas people have had, most of them are there for a purpose. "Don't electrocute people" isn't nearly enough to get a dim bulb technician to know the right wiring or grounding rating for a particular use, or correct routing, or to prevent corners being cut when the company employing pays them minimum wage or on piecework. Best efforts are regularly compromised as a matter of policy when profit is the key driver. It's an area with clear need for strong regulation, otherwise people die.
As someone who rewired my first house, even the onerous regulation wasn't too bad - do the work, stop at the 80 amp fuse, and get a suitably qualified electrician to check and sign it off before hook up. I forget the costs now, but perhaps pay £200 for the safety check and hookup, but saved £2,000+ for having someone rewire.
The rules are simple. They have to be in order for the semi-interested teen to be adequately taught. No small business or self employed guy need be ruled out. I have a friend who, for developing his business, did a few of these courses a few years back - to get the necessary papers to add additional services. His recollection: Extreme boredom because mostly they try to teach common sense - something vanishingly rare - as a college course, pitched for those who had difficulty with shoelaces.
Sadly some of that is the price to be paid for not killing people with shite wiring or gas plumbing. Deregulation or simplification has a death toll - which is why the rules got writ in the first place. I vote to keep - even if the rules are imperfect as they are 99% common sense. I've seen (and paid to repair or replace) what people do to houses and offices, left to their own devices, more than enough times than to encourage more.
He didn't say it takes a lawyer to install solar panels. Just that it would probably take a lawyer to install them and sell the excess power to your neighbors. I'm guessing the same would be true in the UK.
Utilities are natural monopolies. It's not feasible for every company in the marketplace to build their own water, gas, or electricity distribution network.
There is no evidence of natural monopolies ever actually arising naturally as you're describing. In every instance, government either acted pre-emptively and established a monopoly itself or the monopoly was a result of other government regulations and policies (for instance, patents and copyright).
Do you really want 10 different companies installing power lines, electrical wiring, etc? Also, without a government granted monopoly, private corporations would only compete in the most affluent areas. They wouldn’t offer services at an affordable rate if at all to less dense areas.
Yeah, that sounds amazing. Do you think there should be zero alternative firms
Now imagine a picture of a city with 10 sets of power lines, gas lines, and water lines. Each having to ask for right away to dig up streets and right of way...
That's a ridiculous assertion and doesn't apply to any other good. There may be more options for the affluent, but that's not the same thing.
It’s not an “assertion” it already happens with internet and cable. No one is going out of their way to offer gigabit internet to rural America.
Before, the government forced utility companies to offer service everywhere for phone lines, electricity, and to a lesser extent water.
And why should they? People should be living efficiently in cities anyways where they're more productive and have less carbon footprint.
In the 1980s there were many operating systems for PCs: Commodore had one, Amiga, etc. PCs became important for white-collar work with the result most prospective white-collar workers would learn how to use an OS to make it easier to find a job. Which OS did most of them learn how to use? Well, if you are a prospective software dev in 2019 which version-control software do you learn how to use to make yourself more attractive to prospective employers? git of course -- even if you think Mercurial or Fossil is better -- because git is the one most employers use. And employers will standardize on git partly because that is what their prospective employees are most likely to know. Same thing happened with personal-computer OSes in the 1980s and 1990s with the result that by 1997 Microsoft Windows had 95% or 98% of the market. (Apple was in danger of going out of business in 1997 when Microsoft publicly invested $150 million in Apple stock. Microsoft's motivation here was probably to make Microsoft look less like a monopoly to governments, reporters and voters.)
Is it not possible that this mechanism by which the most popular product is the most attractive one (to prospective employees and employers in our example; in another example it might be people wanting to make phone calls) -- thereby making that product even more popular -- could create what grandparent referred to as a "natural monopoly" even in a completely unregulated market?
You might reply that Microsoft could not have achieved its monopoly without the enforcement of copyright laws by governments. Well, consider an alternative reality in which there is no copyright law, but Windows is distributed only with new PCs and runs inside a cryptographically-secure enclave. In other words, there are purely technical ways to achieve the same business goal that was in actuality achieved by copyright law.
Apple was in danger of going out of business in 1997 when Microsoft publicly invested $150 million in Apple stock. Microsoft's motivation here was probably to make Microsoft look less like a monopoly to governments, reporters and voters
This is apocryphal and not what happened.
At the time that Microsoft invested $150M in Apple, Apple had $4 billion in the bank through loans. Also, Apple turned around and in that same quarter, paid $100 million to buy out Power Computing’s Mac license. Apple also continued to lose money for the next two or three years. The net $50 million wouldn’t have made a difference.
Apple was abnormal among tech companies back then for having a huge cash stockpile. These days, they have billions just because they have too much money to know what to do with. But back in the 90s, they had billions in cash & short term investments even though the whole company was only worth a few billion. Of course, you could argue that meant that the market was very pessimistic about their business and therefore they were very shaky. But they were very different from a typical struggling business that is levered up and has to make the vigorish every month.
> Is it not possible that this mechanism by which the most popular product is the most attractive one (to prospective employees and employers in our example; in another example it might be people wanting to make phone calls) -- thereby making that product even more popular -- could create what grandparent referred to as a "natural monopoly" even in a completely unregulated market?
You must realize that you're describing a free product, right? The way people organize around free things is totally different to something they pay for.
People are incentivized to not pay for bad service when better options exist. And the worse the service or the higher the price, the higher the incentive. Entrepreneurs are incentivized to enter a market under those conditions. The more opportunity they see, the more likely they are to enter the market.
The only way to prevent competition is to provide such good service that there's no room for competition (which I can't see a problem with), or to raise the barrier to entry with state policies.
> You might reply that Microsoft could not have achieved its monopoly without the enforcement of copyright laws by governments. Well, consider an alternative reality in which there is no copyright law, but Windows is distributed only with new PCs and runs inside a cryptographically-secure enclave.
I don't think what you're describing would stop anything, but it sure would make using a computer more onerous and likely push away a lot of customers.
> In other words, there are purely technical ways to achieve the same business goal that was in actuality achieved by copyright law.
There just aren't the same tools available to firms when software can be freely modified and redistributed.
Yeah, and it all starts with calling into a place to be greeted by a horribly inefficient "automated" phone system where you need to spend 10 minutes navigating menus that can't detect voice correctly.
It puts 100% of the burden on the customer to save the company time and it seems every company does it.
I remember spending close to 5 hours 1 day trying to get health insurance where it was just a combination of automated phone options, waiting on hold, being redirected, waiting again, and in the end within 15 seconds of finally getting to a human I was disconnected (I was 100% calm too, they were just asking for my details). And then after thinking "fuck this shit, I'm never buying insurance again" I got the luxury of having to pay over $5,000 in fines for not having health insurance for 2017-2018's tax year.
I don't understand why society puts up with this stuff and unfortunately 1 person can't make a difference.
This is nothing compared to health insurance billing processes in the US. They work damn hard to tell you that you owe something, but the second you pay them they stop trying to make things right.
> If anything, the amount of shadow work foisted on customers has increased. Somehow it's a norm to have to go through a bunch of bullshit to have errors corrected and often just to get halfway decent service. It's obviously worse in industries without meaningful competition, but society in general seems to put up with it and assume that's just the way it is.
I've toyed with the idea of putting up a personal ToS detailing a $50/hr charge for time spent on hold, and then sending invoices to companies which treat me to crappy customer service antipatterns...
That wouldn't work in my country. I tried it. They told me to sue them, so at least I got a response. It's a big ISP who left me without Internet from 27.04. to 12.11.
That is what I will do. Mainly because I had to pay for the service for the months it didn't work. If I didn't, they would've sued ME for not paying. (in case of a complaint of the bill, you have to pay average of 3 months previous bills. In fixed bill scenario, you pay the same, and the law is useless in that case)
I am surprised. They could have simply sent nothing! And then their reps would simply say “I do understand what you’re saying sir, and I apologize, but I don’t have that ability.”
I mean, you actually got some director on the phone and he listened to you? Only in the 90s... :-)
This is entirely a problem for the solicitor. The solicitor sent Mr. Teich's money to the wrong person. Mr. Teich's act of giving the wrong info does not let the solicitor give his money away to some stranger. Mr. Teich's is still owed £193,000 by his solicitor.
The solicitor should use a more secure service for sending money. Something that is harder to make a mistake and that provides better guarantees. For example, a cheque, a money order, a professional money transfer service, hell, even a Venmo transfer would be better, as you can send a QR code and that's harder to mess up.
Having worked in a post office and having heard hundreds of stories about dealing with corporations, I can confidently say that anything like this should be done by registered mail with delivery confirmation. Digital solutions simply aren't up to scratch yet. With any "interaction," there are so many things that could go wrong: information mistakes, sorting mistakes, lack of evidence when figuring out a problem, potential for identity theft, potential for malicious actors to gain, potential for things to get lost, lack of accountability, lack of insurance, etc
To tell a fun anecdote: My parents have two bank accounts with identical account numbers and different routing numbers. They still use both accounts for legacy features of each.
The accounts used to be a single account at one financial institution. It got bought by a larger financial institution about ten years after they were married (this was their first joint account as a couple). Fifteen years after that, the bank split apart into three regional banks. The routing number changed with each corporate change but the account number persisted. In the last split, some customers who had property mortgages were “retained” by the divesting bank and “acquired” by the divested one.
Thus, two identical account numbers, different routing numbers.
Yep. I lived in a country for while with modern banking. Bills were sometimes paid instantly, but often paid that night. Some folks still complained however, wanting it all to be instantaneous. Yes, that's possible these days, but be careful what you wish for.
I fixed one mistake on a bill payment made in the afternoon later in the evening, thought "thank $diety," and learned an important lesson.
Certainly large transactions should receive a modicum of scrutiny and delay to finalize.
Also, it's easy to criticize the bank, but what should one do when a transaction is disputed by the two parties? How does the bank know which is lying or mistaken, for sure? Sounds like the perfect time for a court to get involved—that's what they do.
We have instant payments under about $1000 in Australia, and next business day for anything over. RTGS (real-time over $1K) is available for an extra fee of about $2.50.
What if the guy in the article intentionally provided wrong details? So he could purchase a valuable item using money in receiving account as proof of payment and then refund the money and keep both the item and the money?
I don't think that's the case but seeing it from the banks point of view such scenarios could exist.
As someone who moved from Turkey to the UK 3 years ago, I could say that the British Bank system is closer to non-existent. You can't make such silly mistakes in the Turkish banking system because the system rejects the transfer if the recipient's name is wrong/mistyped.
“Angered by the bank’s reply, Teich contacted the Guardian for help. We asked it to reconsider his case, and in an almost immediate U-turn, it has now agreed to pay all his legal fees, and has offered him £750 in compensation.”
If your business can immediately do the right thing when contacted by a newspaper in a no-brainer case like this, but not a second sooner, then you’ve got problems. That said why in the world did the individual who forced this to court not get slapped with covering his court fees?
I had a similar thing when I bought a unit in a brand new apartment building. We'd waited something like 6-8 months for the local phone company to install landlines (needed for broadband). The building was in the central city area, and the main telephone exchange for the city was 800 meters away, on the very same street.
Finally the building manager got a local TV station to do a news piece on the saga, and two days later it was fixed.
Corporations by their very nature won't lift a finger unless it threatens their bottom line. Without that kind of leverage you're at the mercy of their employees - and in banking there's going to be a whole lot of red tape preventing them from doing the "correct" thing.
I never understand things like this. Barclays is one of the biggest financial institutions in the world. It would likely have been way cheaper, easier, and faster to just give the man his money, and even throw a few thousand at the mistaken owner as a good will gesture. Instead, they are paying legal fees now, have bad karma from the story being published, and have angered both parties(or will when the money inevitably gets reversed).
About 10 years ago I had a "near miss" regarding rolling over "traditional" and "roth" 401k monies via a "trustee to trustee transfer" into separate, segregated accounts on the receiving end.
I'm in the US.
For whatever reason, and to this day I swear I was not at fault in giving correct or incorrect numbers across the board, both "roth" and "traditional" monies got dumped into the same receiving "traditional" 401k account. Bad times.
Fortunately, the person I spoke to over the phone understood the situation ... excused themselves to their manager ... called me back with a solution that included a specialized tax form to sort it all out.
A few days later somebody else in the receiving company called me up all "what is going on with this FUBAR?!?". I let them out-wind themselves, then calmly explained the situation as it had been to me, and then all was well for the second time.
Tax time came around and thankfully all became well for the third time around.
Since I am paranoid against the US IRS, I keep paper records for 9 years and on top of that digital-copy records going as far back as I ever can.
Still, this is not as bad as OP-posted article, but I got scared just brushing against such an issue.
The solicitor should have sent £1, verified receipt, then sent the remainder. IMHO quite negligent not to, especially as they should be aware of what happens when mistakes are made.
I maintain an IBAN library.[0] There is actually a lot that is interesting about account numbers. Really well designed account number systems do not include similar glyphs, for example both '1' and 'L' or both '0' and 'O' should not both be present. I have compiled a retroactive list of probable transposition errors in my library, which can recommend checksum-correct potential input intent through brute force search.[1]
While many countries and specific banks had or have alternate checksum systems that pre-date IBAN, not all of them actually cover the whole account number (eg. may only cover the account number itself, not the sort code / branch code / bank code / whatever else). These are also falling out of use at an unreported rate so it is often difficult to determine whether or not they are now significant. Often a bank just starts ignoring its previous rules without telling anyone, leading to popular confusion.
IBAN is a pretty well designed system, possibly excepting the mistranscription issues which it probably considered out of scope but could have seriously helped to avoid with recommendations / best practices. The point of all this is that you shouldn't reinvent the wheel... and that goes for digital banking and digital currency systems as well as any other system with identifiers that may need to be manually analyzed, compared, reported or transcribed.
Sending money between accounts is a jittery experience for me. There is almost no confirmation that the money has gone to the right place, and no checks in case of human error.
I feel we need an additional per-account verification hash that works as follows:
1. Enter recipient bank details in online bank screen.
2. You are then shown a verification hash based on the details entered - you confirm it matches the hash provided by the recipient (obviously, make the hash easy to compare visually).
3. You enter the amount to send and hit send.
This way you can at least ensure the money is going to the correct place. Right now, if you happen to send the money to an unintended bank account, you may never know until the intended recipient tells you.
Wow, it seems banking system in Georgia (the republic of) is so developed.
We use IBANs (despite we are not in Euro zone and most international transfers are in USD), so errors in one digit will be immediately identified and request will get rejected.
Also, if transaction is within the same bank, we always see full name, first name and last name initial, or first name initial and last name (depends on bank and transfer method) before final confirmation.
"Angered by the bank’s reply, Teich contacted the Guardian for help. We asked it to reconsider his case, and in an almost immediate U-turn, it has now agreed to pay all his legal fees, and has offered him £750 in compensation."
I dunno, this sounds fake.
Financial institutions make mistakes all the time, and if the scenario here really did happen, what do you spend £46,000 on? Lawyers are expensive, but they don't charge that much to send a nasty letter. That's like months of billable hours.
Multiple court orders? Does the procedure involve large amounts of unmarked bills for the British equivalent of a judge? £46,000 is obviously not "a bit more" than the fee for writing a letter.
Why would someone assume the Guardian doesn't make up stories like these? Are they more reliable than the Sun?
Not sure what the "British equivalent of a judge" is other than, well, a judge.
Court claims are expensive. This ultimately would've been heard in the High Court and the claimant would want decent counsel to represent him as well as a team of solicitors and other legal professionals to research and handle the correspondence — that's the bulk of the fees.
Then there's the cost of the application itself. The fee for starting a case is 5% of the amount for claims worth between £10,000 and £200,000.
In this case, that's almost £10,000 gone immediately on the court fee. For one case. There's also a court fee for the initial hearing and the return hearing for the freezing order.
Not sure how £12k was spent on the first case—article doesn't mention which court and suggests the High Court was only involved in the second case, but I suspect that isn't true.
"The fee for starting a case is 5% of the amount for claims worth between £10,000 and £200,000."
I don't believe it. If this was really the way the courts over there worked, then nobody would make disparaging comments about the American legal system.
230 comments
[ 3.0 ms ] story [ 233 ms ] threadClassic quote: “The law, in its majestic equality, forbids rich and poor alike to sleep under bridges, to beg in the streets, and to steal their bread.”
Treating people differently through some arbitrary definition of difference is wrong. Either we're all equal in front of the law or some animals are more equal than others. And the kind of justice you're peddling is what has set countries across the world on fire recently; the uneven application of the law.
[Edit] I don't think I was clear. Everywhere we see special cutouts in the law, all that happens is that the more capable less scrupulous people capture those cutouts. The best we can hope to do is to treat everyone exactly the same in front of the law.
"Equal in front of the law" actually means that financial penalties should be progressive in the same way taxes should be. Some countries actually do this, and they're not on fire.
How would it not be treating "everyone exactly the same in front of the law" to just say that fines are assessed as a percentage of income and/or net worth?
All of that said, personally I wouldn't extend this all the way back to the original argument about theft though, stealing $1000 is the same regardless who you steal it from, at least as far as the law should be concerned. I could see a moral difference, but the law often does not (and can not) make moral distinctions. It could however make reasonable distinctions in the application of the punitive aspects, as it sometimes does in terms of jail sentencing.
The cost of risk externalized by one person speeding is about the same, modulo driver skill and location and whatnot; it is not very sensitive to rich the driver is. If the goal of the law is to impose enough additional risk of a fine to compensate for the externalized risk, then it makes perfect sense that millionaires don't need to obey speed limits--as long as they can pay up.
If the law is intended as a deterrent, this obviously isn't working.
Bean counters will manage it though, if asked.
And this is sensible. How do you compensate a family for a dead body? You can't. So the purpose of the law should be to prevent the need for that compensation in the first place.
I suspect you don't believe that, so when you say "the government treating someone differently (in anyway) due to who they are is wrong" what do you mean?
Do you believe that will have the same deterrent effect across society? I sure don't.
https://news.ycombinator.com/newsguidelines.html
If enough people steal from "the bank" under your theory, the old blind lady winds up eating cat food and not being able to pay her rent because the bank is no longer profitable.
That doesn't sound quite as "defensible", now, does it?
Note that things like banks and insurance companies (another favorite whipping boy) do tend to have their stocks owned by things like retirement funds, precisely because they are considered low-risk investments with a safe (albeit small) yield.
It's simple to me. a single person stealing from a bank incurs a lot less suffering then a single person stealing from a welfare recipient. The damage done is simply not even comparable.
Yes, you absolutely are.
> it's proven that the government will swoop in and save the bank as happened
And you're also apparently seeing "the government" as a faceless entity with an unlimited amount of cash.
When the government "swoops in", it's at the expense of every single taxpayer.
I'm boggled that people are incapable of understanding this, or are in such denial about it that they feel the need to mod me down rather than debating the point.
That doesn’t necessarily justify a theft but $1000 isn’t identical utility to all.
https://news.ycombinator.com/newsguidelines.html
Maybe Barclays do not include such a term?
--
[1] http://www.legislation.gov.uk/ukpga/1968/60/crossheading/def...
This is the unfortunate state of business. You’re fucked unless you can rake a company over the coals in a public.
Hard for me to not be a pessimist when thinking about the future because it always leads me to believe there will be a social point system like that episode on TV series Black Mirror.
https://en.wikipedia.org/wiki/Nosedive_(Black_Mirror)
> A high-profile Chinese businessman is on the brink of becoming a social outcast and being banned from his lavish spending habits by the courts if he doesn't pay back $21.5 million debt, even though he is the son a well-known real estate tycoon.
> Wang Sicong, the son of the billionaire owner of AMC Theaters, Wang Jianlin, was last week listed in the national database of the Supreme Court of China of debtors and defaulters with outstanding debt. A failure to pay within the given time will see him join the ranks of “discredited” people.
https://www.nbcnews.com/news/world/billionaire-s-son-latest-...
If a crypto (or other digital) currency has reversible transactions ("Undo this transaction and all the after effects"), that would be cool. So if I spent that 10K on a new Mac, after the Undo I'd have the Mac and a huge unpaid bill from the Apple Store...
2. I think the primary issue is down to cuts to the judicial system. Courts are overburdened with cases and a change in the law would do nothing to address the root cause of why it took two years.
"That money was such a godsend for me and my family. I didn't want to touch it at first, but my son lost 5000 pounds betting on horses, and the bookies were threatening to break his legs. My daughter was failing her classes while working two jobs, with the money she could stop working and focus on her studies. She's always dreamed of becoming a reporter", etc.
Jane received this money through no fault of her own, and now that she's had to give it back, her life has been thrown into turmoil once more. And that's not all, she is now facing prison for a non-violent crime she had no idea she was committing.
Etc. etc., the article basically writes itself.
Because asking people to be nice won't scale as well as getting a bank to behave.
On the up side, I the end it all worked out. Had this been some internet account screw up recourse would have been harder.
1234567890-1234-checksum(1234567890-1234).substring(0, 6)
where 1234567890 is the account number, 1234 is the short code, and then 6 characters are typed in at the end are a checksum.
The short code is unique. So if you type in the correct checksum but not the correct short-code the fully-qualified unique identifier does not pass the validation step. Like-wise, if you type in the correct short-code but not the checksum then the unique identifier also does not pass the validation step. Thus, the user is protected against typing in an incorrect short code.
The bank account numbers have had check digits since 1967!
In most cases the sort code is included in the checksum
https://www.vocalink.com/media/3513/vocalink-validating-acco...
https://www.xe.com/ibancalculator/sample/?ibancountry=united...
It is often possible to perform foreign transfers using destination IBANs, but they seem to prefer (or require) the traditional approach for UK Sterling transfers.
I can understand why they retain the old system, but it would be useful if they in addition offered the ability to specify the target via IBAN for domestic transfers, since they already do for transfers to the rest of the EU.
Even when doing a SWIFT transfer, the IBAN (if one has it) is useful.
Japan has the same system of sort/branch codes and account number, but when I enter those here the recipient name is automatically filled out, making incorrect transfers pretty much impossible (unless, I guess, your mis-entered transfer to Mr. Sato is transferred to a different Mr. Sato instead)
A part of the Eurozone transition was that all local systems were replaced by SEPA SCT/SDD, which are inherently IBAN based. But SCT/SDD only apply to Euro transfers, and so in non-eurozone locales the existing infrastructure and nomenclature is retained
> Japan has the same system of sort/branch codes and account number, but when I enter those here the recipient name is automatically filled out, making incorrect transfers pretty much impossible (unless, I guess, your mis-entered transfer to Mr. Sato is transferred to a different Mr. Sato instead)
There is a Confirmation of Payee system coming soon in the UK (which most of the large banks have, unfortunately, delayed). It works slightly differently: it will compare the name, but not _generally_ tell you the name of the recipient because that comes with privacy concerns
These could be compatible though. e.g. in Poland numbers used for local bank transfers are just IBANs with country code trimmed from the front.
Note that it is still possible to check an account number without an IBAN: https://github.com/AntoineAugusti/moduluschecking
The issue here was not the account number being wrong, but rather the combination of sort code and account number being wrong - for which there is not necessarily a checksum digit covering the pair.
I have some accounts where the sort code and account are not directly embedded in the IBAN. So for those possibly there is a mapping table one could refer to.
UK banking system is 6 digit sort code and like 8 digit acc.
The accounts are IBAN compatible though & it's derived from the above - but I can send money to a friend UK-UK without any IBAN stuff.
Given the specificity here, have to sue Barclays to find out whom did the money go to. Barclays cannot take customer money without a court order or disclose customer identity. Then sue the person to get the money back.
I think the lesson here is that person who tried to keep the money is a dickhead. Moreover, it's really lucky that he didn't burn it all and was insolvent.
I guess it gets blurry when looking at it after the fact and he's been formally refusing to return it for a year.
Dishonestly retaining a wrongful credit.
(1)A person is guilty of an offence if—
(a)a wrongful credit has been made to an account kept by him or in respect of which he has any right or interest;
(b)he knows or believes that the credit is wrongful; and
(c)he dishonestly fails to take such steps as are reasonable in the circumstances to secure that the credit is cancelled
Did he dishonestly fail to take reasonable steps? From the article, it seems that the bank asked him if they could take the money back. It would seem to me to be a reasonable step for him to say "yes". Did he dishonestly do so? Tricky one; Theft Act 1968 specifies what dishonesty is not, leaving it open to a jury to decide what it is.
Theft Act 1968 says the following cases are NOT dishonesty:
None of those applies, so it's definitely possible that he did act "dishonestly" under the Theft Act 1968, in which case yes, this is theft.HOWEVER, there is an incomplete definition of "wrongful credit" here that could throw a spanner in the works:
A credit to an account is wrongful to the extent that it derives from—
(a)theft;
(b)blackmail;
(c)fraud (contrary to section 1 of the Fraud Act 2006); or
(d)stolen goods.
One legal interpretation of "to the extent that" is simply "if", in which case this was NOT a wrongful credit to an account, and this entire section of the Theft Act 1968 ceases to apply.
HOWEVER, it's not "if and only if"; could one argue that this was a wrongful credit? Well, it was certainly wrong in that the account that was credited was not the intended account. I suspect a good lawyer could reasonably argue this, but I don't need to go looking for case law; in this case, the court agreed that the money must be returned, which I think is itself case law supporting the idea that the recipient was in the wrong.
Either way, it's still a civil case at the beginning. Have to go to court with the bank to formally request a return and establish the identity of the holder.
By the way I was thinking of another Act that says you have to return stuff sent to you by mistake, can't seem to find it again.
In this case, is it a "wrongful credit"? Arguably, yes — it's theft per S1(1) of the Theft Act 1968 since the recipient intends to keep it and appropriates the rights of the owner in doing so.
The closest Act I can find regarding returning stuff sent to you by mistake is the Consumer Rights Act 2015, specifically S25 which says that if the trader sends you a quantity of goods greater than you were expecting, you may accept them but you must pay for them at the contract price—you cannot keep them for free: http://www.legislation.gov.uk/ukpga/2015/15/section/25
The original Act was the Unsolicited Goods and Services Act 1971 but the section on the right of recipients to keep unsolicited goods has been repealed accordingly.
"Any assumption by a person of the rights of an owner amounts to an appropriation, and this includes, where he has come by the property (innocently or not) without stealing it, any later assumption of a right to it by keeping or dealing with it as owner."
In this case, the person innocently came by the money as a result of a mistaken bank transfer. They then proceeded to withdraw it from their account and presumably spend it: thus keeping it and/or dealing with it as the owner would—meaning they appropriated it accordingly.
All other elements seem to be made out here too: A person is guilty of theft if he dishonestly appropriates property belonging to another with the intention of permanently depriving the other of it; and “thief” and “steal” shall be construed accordingly.
The conclusion hints that it was returned, without making it clear. In the absence of better information, I would assume that it wasn't used or withdrawn, it couldn't have been returned if it were.
Doesn't it say that he "bagan to withdraw the cash" though?
Wow. So far behind.
"Barclays said it asked the person who received the cash for permission to return the money, but he refused."
There is nothing to refuse. The law in my country would be pretty clear about this. Honestly, just to prevent the guy withdrawing and spending it, it would very likely pay him a visit. But that is me.
The better resolution is to make sure such errors don't happen in the first place.
All the things he initially asked Barclays to do were refused not because they didn't want to do that, but because Barclays can't do that. They can't return the money without a court order (in these particular circumstances the payment was "executed correctly" according to the legal criteria, because the payment was intended to be sent to that account number and was credited to the matchign account number, so any uf the more common justifications of error-fixing can't apply. But the payment laws pretty much implicitly assume that the account numbers are unique, and they weren't in this case), so if the recipient disagrees, then either it goes to court or the money stays there. Furthermore, revealing the account holder's identity would be a crime under banking secrecy laws - again, a court order was needed for that, it's not something that Barclays is allowed to do at their discretion.
What does seem ugly is the obscene legal costs - it should not take 12000 and 34000 pounds to submit a simple claim to the court that (as far as I understand) was not even contested.
They charge extra because they know they don't get paid if they loose. Also, there was a good chance they wouldnt get paid if the recipient of the money took it all overseas, or if the 74 year old died before the issue was resolved.
Source: I'm a plaintiff in a lawsuit that is very likely to win damages, and get contacted all the time asking if I need funding for the case.
I have never liked the business, frankly lawyers are scummy and will (if given enough time) screw you eventually, but it exists (btw, Burford Capital are known for taking liberties with their reporting to investors...which kind of proves the point).
I don't see how the situation would be relevantly different if Teich had mistakenly provided the wrong account number and the correct sort code.
> there really aren't good solutions if the (unintended) recipient disputes the reversal and claims that that's money intended for them.
I also don't see why this is a question we ask the recipient. Wouldn't it make more sense to ask the payor?
Because at that moment that's the recipients money as far as the bank is concerned - it might have been a payment for some valuable item and the payment order used as proof of payment, it might have been a gift or anything, and the beneficiary is legally protected from the payer changing their mind after the fact, the bank isn't allowed to take their money without the beneficiary's consent just because the payer wants it. There are specific legal exemptions that may apply for cases where the payer didn't actually order that payment (e.g. some types of fraud, or technical faults such as a single order getting executed twice), but they don't apply here, because they did order that payment to that account, so it pushes this situation into the same box as all the other (quite frequent) issues of the payer changing their mind after the fact and wanting the money back.
If there's a dispute and the payer claims that the beneficiary shouldn't have that money and they owe it back - well, the banks don't get involved in disputes about who owes whom what, they can only execute payments when ordered by the owner of the money or a court order resolving that dispute. It's just as with a cash payment, if someone has gotten your pile of cash because there's been a misunderstanding, or mistake, or a change of mind, or even actual fraud - you can't simply take the cash away from them if they disagree or dispute the issue, they'll keep the cash until the dispute is resolved, or possibly the police will seize/freeze that cash following due legal process.
There are very many cases where there might be a dispute between a payer and the beneficiary, someone demanding their money back for all kinds of reasons - those cases far outnumber situations like this one. We have a process for resolving disputes about money, and that involves civil claims in court. After a correctly executed payment is completed (and a payment credited exactly as the payer ordered, even if they wanted to order differently or changed their mind) it can be reversed only if the beneficiary agrees or by a court order taking the money from the beneficiary and returning it to the payer, as in this case, that's the law.
> Teich had given his correct name, address and Barclays account number in Cambridge to his solicitor – but the wrong sort code.
> At the moment, anyone wanting to transfer money is asked for the recipient’s account name, account number and sort code. However, it’s typically the case that the bank does not check if the account name is correct.
> The mistaken transfer – called “misapplied funds” in banking parlance – could not have occurred if UK banks matched up sort codes and account numbers with the account holder’s name. But they do not. A recipient’s name could be given as Mickey Mouse and the bank would still process the payment, using the sort code and account number alone.
Actually, pretty much all relevant law for this thing is on this single page - http://www.legislation.gov.uk/uksi/2017/752/regulation/90/ma... (with some additional info at http://www.legislation.gov.uk/uksi/2017/752/regulation/83/ma... stating that the payer can't simply revoke the payment)
The other account was the unique account matching the account number + sort code (this combination is presumably what Barclays deems the 'unique account number') - so that's "executed correctly" according to "Where a payment order is executed in accordance with the unique identifier, the payment order is deemed to have been correctly executed by each payment service provider involved in executing the payment order with respect to the payee specified by the unique identifier."
The payer had also specified the name and address, but the law explicitly states that the bank is not liable for mismatches of the name or address, it's only required to execute it according to the account number. "(5) Where the payment service user provides information additional to that specified in regulation 43(2)(a) (information required prior to the conclusion of a single payment service contract) or paragraph 2(b) of Schedule 4 (prior general information for framework contracts), the payment service provider is liable only for the execution of payment transactions in accordance with the unique identifier provided by the payment service user. " is quite a mouthful but it essentially says that even if you provided extra information, that information can be ignored.
However, the article implies that Barclays did not fulfil their requirements of "(3) The payee’s payment service provider must co-operate with the payer’s payment service provider in its efforts to recover the funds, in particular by providing to the payer’s payment service provider all relevant information for the collection of funds." which does seem to require them provide sufficient information to sue the mistaken recipient to return the money.
It might be important to you that the money goes to Jim, but from the bank's perspective they executed the instructions correctly.
If the Solicitor had instead posted a cheque to the heir, then the problem likely would not have occurred, and if it had would have been reversed a lot sooner.
It's the cause of millions in fraud.
So, learn from this and double, triple, quadruple check what you enter every time. It takes less than a minute and can save you from bigger headaches. Just like wearing safety goggles.
Except that you're not responsible. Peter Teich got his money restored using only the UK legal system.
The process was:
1. Sue the bank for the other customer's name.
2. Sue the customer who received the payment.
3. Recover from them. This recovery is (surprise!) enforcible by the bank.
If you were responsible for the consequences of sending money to an account you specified incorrectly, none of that would be possible in the first place.
Obviously, when a court order compels recovery of the funds, the bank is obliged to comply.
I do think it's a good system, if you want to recover your money, you can go to court. Wish it was cheaper/faster/more straightforward to do that.
The verification would only happen prior to the first transfer of value, with subsequent transfers using the verified information.
People do this all the time. Mum mum did it recently paying for a used car.
Also usually the payment details are saved after the first payment so the risk of making a mistake with the second payment is low. You would reuse the saved payee.
>Also usually the payment details are saved after the first payment so the risk of making a mistake with the second payment is low. You would reuse the saved payee.
Exactly. A twist is my bank wipes the saved payees after a few months or so.
Seems like if the banks cared they could add a very similar process for adding personal transfers, and mostly automate it for their customers. Except it's customer money being lost so the impetus is not there.
18-year-old me had an account with the Halifax, then a building society. One week, £50 appeared in this account. I knew it wasn't for me, and didn't want to spend it as I knew I'd have to give it back at some point. (I'd asked my girlfriend's dad, a lawyer who worked for the Crown Prosecution Service, if I could just keep it. He compared it to someone parking their car on my driveway. They shouldn't leave it there, but that doesn't mean it becomes my car.)
I wrote – on paper, in an envelope – to the Halifax. They said they'd do something about it. They didn't, and a month later another fifty quid arrives. This went on for a few months, from memory. When they finally sorted it, I pointed out that another bank (HSBC?) was, at the time, offering a £25 'sorry, we screwed up' payment. I suggested that they might like to send me £25.
The manager wrote back and told me that as 'no inconvenience or cost was incurred by me' as a result of this error, he didn't see why he should give me £25. Looking back, this event shaped how I feel about corporations, about how the 'little guy' is treated. I was fucking furious, so I meticulously detailed all of the costs, including my time at the minimum wage of the day, and put them in a letter. I mean down to the cost of the envelopes, the stamps, and the landline calls that I'd made. Everything, itemised. It was beautiful.
I called and got the manager on the phone. I explained my stance, and read through each line of the letter I was about to send. "Do you agree that this was a cost incurred by me?", I asked after every line. He couldn't disagree. I think the total was somewhere around £60. I finished the call by saying that he'd be getting this detail in the mail, and that it wasn't a letter this time, it was an invoice. Then – oh man, I remember this – I just hung up on him.
They sent me a cheque.
When I was in college, someone kept leaving their car in our driveway, in a spot we had rented to a now-irate third party. The police wouldn’t tow it, but a friendly cop clued me into the procedure for claiming “abandoned” property.
I filled out some paperwork, paid a $10 fee, and the cop came back with some giant “abandoned?!” stickers that he pasted all over the car. If no one called the number on the stickers within 72 hours, the car would be mine.
Alas, at hour 70, a woman came out and started furiously scrubbing away the stickers, so I just missed getting a car. On the plus side, she never parked there again and the rent money from the parking spot covered our cable and propane bill until we moved out.
Bad in an inactive kinda way, but nevertheless, something that I, as a good human, should feel sufficiently bad about to warrant my taking action.
There's unavoidable headaches and potential expenses here.
If our Internet cuts out and I have to call in to get it fixed I calmly but firmly let them know that I must be fully credited for the day, pro rata.
They always have beef with this and tell me that “normally they don’t do X or Y unless A or B”. I tell them that I fully understand their position, but my position is this:
“When I hang up this phone call it will either be because you have credited me for the day that my service failed and I had to do your company’s job debugging it, or because I have terminated my service. The choice is yours but those are the only options.”
Utilities like water, gas, and electricity are monopolized by the state: torn away from the market's invisible hand.
Internet providers use government regulations, not available market forces, to keep out competitors.
Colloquially, a free market refers to one in which a minimal amount of government intervention occurs. The less state intervention, the more free the market.
Without regulation and strong intervention against problematic companies cartels, profiteering, monopoly and all the other problems of unconstrained capitalism tend to result. Standards will fall, prices will rise, deals will be done on golf courses and in (formerly) smoke filled bars against the interests of the customers.
The best markets are ones that have a clear market, and are kept free and ethical by strong and appropriate oversight (government). Needless to say there are many markets that are not appropriate uses of the market, and oversight does not work too well with a revolving door between commerce and regulator, smoothed by filthy lucre.
Whenever you define freedom as "what you get when you do X" you have set yourself up for Orwellian denial of reality.
I think a good way to define freedom is "the condition of having a reasonably large number of good choices". The better and more diverse the choices, the more freedom.
High initial investment cost have totally no role to play at that. Or landlords allowing only a single ISP [0]... that's just part of the market... you can always move, after all. But no, dysfunctional markets must be because of government regulation, since markets are so great that there are no other form of market failures.
Sorry, but equating regulatory capture with "government regulations" kind of triggers me. Companies obviously will use everything possible to their advantage. Including dysfunctional governments. At that point, fixing your gov might be the more important issue...
[0] https://www.eff.org/deeplinks/2019/06/fcc-siding-landlords-a...
> Sorry, but equating regulatory capture with "government regulations" kind of triggers me.
Regulatory capture is composed of government regulations.
> fixing your gov might be the more important issue
Exactly
Google Fiber and “shallow trenching”. https://arstechnica.com/information-technology/2019/02/googl...
It’s also not exactly unlike Google to abandon projects for the new ooh shiny.
I've experienced how local governments handle ISP regulation first-hand. I can say with confidence that it causes many, if not most, issues with ISP monopolies in suburban and rural areas in the US.
Take Thames water, busy playing with offshore finance plays, massively increasing profit and exec pay whilst reducing on all performance measures. Worst nationally for leaks, rate of fixing leaks, managing supply, it goes on.
I can get my electricity from any of the companies in the UK, same for gas, without any restriction. I can choose on price or service, regardless of where I live. Yet service standards have declined, prices have risen far in excess of inflation, and buffer overhead of generation, production and storage has declined. The national grid is more fragile than it was as a result. That's despite efforts of the grid to modernise, and provide a smart grid for renewables. It's required additional regulation to bring back a little headroom on the grid, and inadequate regulation to prevent extreme profit-seeking. The projected plans for additional pumped storage and hydro and tidal schemes have been shelved. For decades. Electric has indulged in the same banking roulette with currency plays seeking profit in preference to producing electricity.
So what part of the market is missing? None. What advantages has the market brought? For execs and shareholders, free money! For customers and the climate? More costs, poorer service.
The biggest winners? The US corporations and hedge funds who fell like vultures on the privatised companies. Oh, and the French state - their power is still significantly state owned, I think 51%. They've been able to save their tax payers money by joining in the profiteering from UK generation - one of the big 6 UK suppliers is EDF: Électricité de France.
A lot of that is regulatory capture, but the other huge factor is administrative costs. Even if I can do a great job and do everything safely with no danger to anyone -- suppose I'm an electrical engineer -- then I'm still not actually allowed to do it because the rules require an electrician.
We could have simple rules -- don't electrocute people, don't start a fire -- but sometimes it will happen despite our best efforts. Then a bureaucracy doing the work will want to defer blame. A set of regulations allow that. If there is a fire but they followed the regulations, well, they followed the regulations. Not their fault anymore, even though it ought to be. But then every time something bad happens, you get another rule (even if there are five other, possibly better, ways to solve the same problem), until the rules are so complex that only a large bureaucratic entity can follow them. Having destroyed competition, we can now blame the market for the resulting badness.
As for the other, it pays to remind ourselves why we have some of those rules. After years of assorted homes and offices, seeing the horrific electrical or plumbing ideas people have had, most of them are there for a purpose. "Don't electrocute people" isn't nearly enough to get a dim bulb technician to know the right wiring or grounding rating for a particular use, or correct routing, or to prevent corners being cut when the company employing pays them minimum wage or on piecework. Best efforts are regularly compromised as a matter of policy when profit is the key driver. It's an area with clear need for strong regulation, otherwise people die.
As someone who rewired my first house, even the onerous regulation wasn't too bad - do the work, stop at the 80 amp fuse, and get a suitably qualified electrician to check and sign it off before hook up. I forget the costs now, but perhaps pay £200 for the safety check and hookup, but saved £2,000+ for having someone rewire.
The rules are simple. They have to be in order for the semi-interested teen to be adequately taught. No small business or self employed guy need be ruled out. I have a friend who, for developing his business, did a few of these courses a few years back - to get the necessary papers to add additional services. His recollection: Extreme boredom because mostly they try to teach common sense - something vanishingly rare - as a college course, pitched for those who had difficulty with shoelaces.
Sadly some of that is the price to be paid for not killing people with shite wiring or gas plumbing. Deregulation or simplification has a death toll - which is why the rules got writ in the first place. I vote to keep - even if the rules are imperfect as they are 99% common sense. I've seen (and paid to repair or replace) what people do to houses and offices, left to their own devices, more than enough times than to encourage more.
I agree. Isn't this also what we see with e.g. Boeing 737 Max? Hollowing out the oversight and regulations in favor of the bottom line.
It’s a highly disingenuous argument to say that we’d be better off with a fully private water market.
Yeah, that sounds amazing. Do you think there should be zero alternative firms?
> Also, without a government granted monopoly, private corporations would only compete in the most affluent areas.
That's a ridiculous assertion and doesn't apply to any other good. There may be more options for the affluent, but that's not the same thing.
> They wouldn’t offer services at an affordable rate if at all to less dense areas.
And why should they? People should be living efficiently in cities anyways where they're more productive and have less carbon footprint.
Now imagine a picture of a city with 10 sets of power lines, gas lines, and water lines. Each having to ask for right away to dig up streets and right of way...
That's a ridiculous assertion and doesn't apply to any other good. There may be more options for the affluent, but that's not the same thing.
It’s not an “assertion” it already happens with internet and cable. No one is going out of their way to offer gigabit internet to rural America.
Before, the government forced utility companies to offer service everywhere for phone lines, electricity, and to a lesser extent water.
And why should they? People should be living efficiently in cities anyways where they're more productive and have less carbon footprint.
Right, who needs silly stuff like farms....
Personally, that sounds like a better option than living in a city.
Is it not possible that this mechanism by which the most popular product is the most attractive one (to prospective employees and employers in our example; in another example it might be people wanting to make phone calls) -- thereby making that product even more popular -- could create what grandparent referred to as a "natural monopoly" even in a completely unregulated market?
You might reply that Microsoft could not have achieved its monopoly without the enforcement of copyright laws by governments. Well, consider an alternative reality in which there is no copyright law, but Windows is distributed only with new PCs and runs inside a cryptographically-secure enclave. In other words, there are purely technical ways to achieve the same business goal that was in actuality achieved by copyright law.
This is apocryphal and not what happened.
At the time that Microsoft invested $150M in Apple, Apple had $4 billion in the bank through loans. Also, Apple turned around and in that same quarter, paid $100 million to buy out Power Computing’s Mac license. Apple also continued to lose money for the next two or three years. The net $50 million wouldn’t have made a difference.
You must realize that you're describing a free product, right? The way people organize around free things is totally different to something they pay for.
People are incentivized to not pay for bad service when better options exist. And the worse the service or the higher the price, the higher the incentive. Entrepreneurs are incentivized to enter a market under those conditions. The more opportunity they see, the more likely they are to enter the market.
The only way to prevent competition is to provide such good service that there's no room for competition (which I can't see a problem with), or to raise the barrier to entry with state policies.
> You might reply that Microsoft could not have achieved its monopoly without the enforcement of copyright laws by governments. Well, consider an alternative reality in which there is no copyright law, but Windows is distributed only with new PCs and runs inside a cryptographically-secure enclave.
I don't think what you're describing would stop anything, but it sure would make using a computer more onerous and likely push away a lot of customers.
> In other words, there are purely technical ways to achieve the same business goal that was in actuality achieved by copyright law.
There just aren't the same tools available to firms when software can be freely modified and redistributed.
It puts 100% of the burden on the customer to save the company time and it seems every company does it.
I remember spending close to 5 hours 1 day trying to get health insurance where it was just a combination of automated phone options, waiting on hold, being redirected, waiting again, and in the end within 15 seconds of finally getting to a human I was disconnected (I was 100% calm too, they were just asking for my details). And then after thinking "fuck this shit, I'm never buying insurance again" I got the luxury of having to pay over $5,000 in fines for not having health insurance for 2017-2018's tax year.
I don't understand why society puts up with this stuff and unfortunately 1 person can't make a difference.
Worst offender who does this? US Healthcare
Small claim court usually has minor fees to file a case. Most examples I’ve heard had the company settling before it even went to trial.
I mean, you actually got some director on the phone and he listened to you? Only in the 90s... :-)
The solicitor should use a more secure service for sending money. Something that is harder to make a mistake and that provides better guarantees. For example, a cheque, a money order, a professional money transfer service, hell, even a Venmo transfer would be better, as you can send a QR code and that's harder to mess up.
Having worked in a post office and having heard hundreds of stories about dealing with corporations, I can confidently say that anything like this should be done by registered mail with delivery confirmation. Digital solutions simply aren't up to scratch yet. With any "interaction," there are so many things that could go wrong: information mistakes, sorting mistakes, lack of evidence when figuring out a problem, potential for identity theft, potential for malicious actors to gain, potential for things to get lost, lack of accountability, lack of insurance, etc
The accounts used to be a single account at one financial institution. It got bought by a larger financial institution about ten years after they were married (this was their first joint account as a couple). Fifteen years after that, the bank split apart into three regional banks. The routing number changed with each corporate change but the account number persisted. In the last split, some customers who had property mortgages were “retained” by the divesting bank and “acquired” by the divested one.
Thus, two identical account numbers, different routing numbers.
I fixed one mistake on a bill payment made in the afternoon later in the evening, thought "thank $diety," and learned an important lesson. Certainly large transactions should receive a modicum of scrutiny and delay to finalize.
Also, it's easy to criticize the bank, but what should one do when a transaction is disputed by the two parties? How does the bank know which is lying or mistaken, for sure? Sounds like the perfect time for a court to get involved—that's what they do.
I don't think that's the case but seeing it from the banks point of view such scenarios could exist.
If your business can immediately do the right thing when contacted by a newspaper in a no-brainer case like this, but not a second sooner, then you’ve got problems. That said why in the world did the individual who forced this to court not get slapped with covering his court fees?
Finally the building manager got a local TV station to do a news piece on the saga, and two days later it was fixed.
I'm in the US.
For whatever reason, and to this day I swear I was not at fault in giving correct or incorrect numbers across the board, both "roth" and "traditional" monies got dumped into the same receiving "traditional" 401k account. Bad times.
Fortunately, the person I spoke to over the phone understood the situation ... excused themselves to their manager ... called me back with a solution that included a specialized tax form to sort it all out.
A few days later somebody else in the receiving company called me up all "what is going on with this FUBAR?!?". I let them out-wind themselves, then calmly explained the situation as it had been to me, and then all was well for the second time.
Tax time came around and thankfully all became well for the third time around.
Since I am paranoid against the US IRS, I keep paper records for 9 years and on top of that digital-copy records going as far back as I ever can.
Still, this is not as bad as OP-posted article, but I got scared just brushing against such an issue.
While many countries and specific banks had or have alternate checksum systems that pre-date IBAN, not all of them actually cover the whole account number (eg. may only cover the account number itself, not the sort code / branch code / bank code / whatever else). These are also falling out of use at an unreported rate so it is often difficult to determine whether or not they are now significant. Often a bank just starts ignoring its previous rules without telling anyone, leading to popular confusion.
IBAN is a pretty well designed system, possibly excepting the mistranscription issues which it probably considered out of scope but could have seriously helped to avoid with recommendations / best practices. The point of all this is that you shouldn't reinvent the wheel... and that goes for digital banking and digital currency systems as well as any other system with identifiers that may need to be manually analyzed, compared, reported or transcribed.
[0] https://github.com/globalcitizen/php-iban [1] https://raw.githubusercontent.com/globalcitizen/php-iban/mas...
I feel we need an additional per-account verification hash that works as follows:
1. Enter recipient bank details in online bank screen.
2. You are then shown a verification hash based on the details entered - you confirm it matches the hash provided by the recipient (obviously, make the hash easy to compare visually).
3. You enter the amount to send and hit send.
This way you can at least ensure the money is going to the correct place. Right now, if you happen to send the money to an unintended bank account, you may never know until the intended recipient tells you.
We use IBANs (despite we are not in Euro zone and most international transfers are in USD), so errors in one digit will be immediately identified and request will get rejected.
Also, if transaction is within the same bank, we always see full name, first name and last name initial, or first name initial and last name (depends on bank and transfer method) before final confirmation.
I dunno, this sounds fake.
Financial institutions make mistakes all the time, and if the scenario here really did happen, what do you spend £46,000 on? Lawyers are expensive, but they don't charge that much to send a nasty letter. That's like months of billable hours.
Why would someone assume the Guardian doesn't make up stories like these? Are they more reliable than the Sun?
Court claims are expensive. This ultimately would've been heard in the High Court and the claimant would want decent counsel to represent him as well as a team of solicitors and other legal professionals to research and handle the correspondence — that's the bulk of the fees.
Then there's the cost of the application itself. The fee for starting a case is 5% of the amount for claims worth between £10,000 and £200,000.
In this case, that's almost £10,000 gone immediately on the court fee. For one case. There's also a court fee for the initial hearing and the return hearing for the freezing order.
Not sure how £12k was spent on the first case—article doesn't mention which court and suggests the High Court was only involved in the second case, but I suspect that isn't true.
I don't believe it. If this was really the way the courts over there worked, then nobody would make disparaging comments about the American legal system.
I apologise for not making it clear — that fee is specifically for filing a claim in the High Court. Inferior courts will charge less.