In the era of Mobile App and USSD inter and intra bank transfer, transferring money to the wrong account is not outrightly impossible, it is a matter of when. Have you ever made a bank transfer and immediately wished to reverse the transaction? This could be due to crediting a wrong account, being defrauded, or some other reason. If you found yourself in the unfortunate situation of transferring funds in error, Aisha Morohunfola of Mascot Legal Practitioners has a given legal guide outlining the essential steps and considerations to help you reclaim the mistakenly transferred funds.

Let’s get into it.

1. Report to the Bank:

• The first thing you must do is reach out to your bank. You can do that by reporting the transaction, if the transfer was done with your mobile App. You can also write to your bank by contacting them via Email, Social media handles, or calling their customer care line. Your Bank will Notify the recipient’s bank immediately, preferably in writing, providing all transaction details and supporting evidence.
  Before contacting the bank by either of these means, make sure to have all details written out: your account name and number, the recipient’s account name and number, the amount involved, the date and time of the transaction, and the reason you want to recall the funds.
• The recipient’s bank may place a Post No Debit (PND) on the recipient’s account to prevent further withdrawals while investigating the complaint. For Example, if the recipient has N100,000 in his account, and the amount under dispute is N50,000, the bank places a hold on N50,000 but allows him to withdraw other funds.
  However, if the money is already withdrawn, and the available balance in the recipient’s account is less than the amount under contention, a hold will be placed on whatever amount is left, pending the resolution.

  Whether the account is funded or not, the recipient gets invited to the bank to resolve the issue. Here, two things could happen. 

• The recipient’s privacy will be protected, and their personal information will remain confidential.
• If the recipient acknowledges the error and agrees to a reversal, the funds can be returned promptly.
  In resolving the complaint, the recipient has to verify your claim that the funds don’t belong to them. A bank doesn’t have the legal right to withdraw money from a customer’s account without the customer’s consent. Therefore, the recipient has to consent to the reversal, unless it is an outright fraud case.
  

Now, here begs the question.
What if the Recipient claims legal right to the money claiming it was sent as a result of a valid transaction and refuses to give consent to the reversal?

The bank could maintain the hold on their account, making it impossible to spend the money. The problem, however, is that your money remains stuck in the account till the day they walk into the bank to authorize the reversal. When this happens the Bank will advise you to get a court injuction to initiate the reversal.

2. Obtain a Court Order for Reversal:

• Legal representation is necessary if the recipient is uncooperative or unreachable.
• The bank may request a court order to initiate the reversal process.
• A legal practitioner will draft and file an application supported by an affidavit, presenting all transaction-related facts and evidence.
• The court will review the evidence before deciding on the reversal.

Things to note before Approaching the Court

Filing Location:

It is important to note that the appropriate court for filing depends on the transaction amount and location.

• In Lagos State, the Magistrates’ Court handles cases under N10,000,000, while the High Court handles amounts exceeding N10,000,000.
• In Abuja, the Magistrate’s Court and the High Court of the Federal Capital Territory handle cases based on the transaction amount.

Proof Requirements for Reversal Order:

• The applicant must establish proof of the debit, evidence of the erroneous payment, the recipient’s particulars, and documentation of the complaint to the bank.
• Supporting documents include debit notes, bank statements, and demand notices.

Service of Court Documents:

• Proper service of court documents on the bank and recipient is crucial.
• Failure to achieve service may result in the dismissal of the case or the setting aside of any judgment.
• Substituted service may be necessary if the recipient’s address is unknown.

Additional Advice

Avoiding Police Involvement:

• Refrain from involving the police in the reversal process, as they lack the authority to instruct fund transfers.
• The power to transfer funds rests solely with the court, not the police.
• Only Involve the police if it is a case of fraud to deter the culprit from scamming other people.

In conclusion, reclaiming funds transferred in error requires a strategic legal approach in Nigeria. Seeking professional legal guidance and adhering to prescribed legal procedures are essential for the successful resolution of such cases.

PS: Whenever making a transfer, be sure to double-check the account name, number, and bank to avoid sending the money to someone else with similar details. Also, avoid divulging personal details to fraudsters so that they don’t gain access to your account to carry out unauthorized transfers.