With how technology has advanced, there are now many ways to transfer and move money. Money transfers have become so high-tech that you can send money to someone on the other side of the world within minutes. Decades ago, you had to physically withdraw money in the bank and deposit it to another person’s bank account. Now, you can transfer money online or even through a mobile app. You don’t even need to speak to anyone to complete a transaction.
While there are many advantages and conveniences attached to these financial innovations, there are also drawbacks. If you make an erroneous bank transfer, it will not take long before the recipient (whom you may not even know) receives the money. It has also become easier for scammers to steal money from people through bank transfer scams.
So, what if you want to get your money back from an erroneous or unintended transfer? Can a bank transfer be refunded?
It depends. There are situations where getting back the money is possible but it can be a long process and only under ideal circumstances. It will also depend on your country or state’s banking laws and whether all parties will cooperate with your request.
Generally, however, it is very difficult and almost impossible to get your money back once a bank transfer has been completed and the recipient already withdrew the money. You would have to go through legal proceedings which may be costlier for you if the amount of money is not that big.
Can I Cancel A Money Transfer?
If you erroneously made a money transfer or if you have changed your mind, you might be wondering whether it is possible to cancel the transaction.
If you have made a money transfer through your bank, you may be able to cancel it if it is a “remittance transfer”. The Consumer Financial Protection Bureau (CFPB) defines remittance transfers as electronic money transfers from consumers in the United States through “remittance transfer providers” to recipients abroad. Your bank can be classified as a remittance transfer provider.
If the transfer that you made through your bank was a remittance transfer, the CFPB states that you have the right to cancel it if it meets the following conditions:
- The money hasn’t been picked up by the recipient
- You made the transfer less than 30 minutes ago
Some state laws or private provider’s rules may allow you more time to cancel the transaction so it will also depend on the financial institution.
For example:
You want to make a $500 remittance transfer to your sister who lives overseas and by mistake, you entered $800 so you want to cancel the transfer.
If your sister did not claim the money yet and you realized your mistake immediately, you have the right to cancel the transfer within 30 minutes.
What if I Made A Bank Transfer, Not A Remittance Transfer? Can I Get The Money Back?
Bank transfers, also known as wire transfers, are typically bank to bank transactions. A bank transfer will usually take 1 to 5 business days to be processed depending on your bank, but some banks can now process wire transfers instantly.
Within this time, if you want to cancel the transaction, you have to contact your bank to see whether this is still possible. You have to take note that the bank may not be liable to give you your money back if they cannot retrieve it.
Whether you can get your money back will depend if all parties will cooperate – your bank, the bank who received the money, and the recipient. If the money has been withdrawn, it is very rare that you’ll get your money back.
According to a Quora user, this is the process that he had to go through when trying to reverse an erroneous bank transfer. The entire process took 30 days from the time the money left his account to the time it was returned.
- Contact the bank you used to send the money to inform them of the erroneous bank transfer and ask them to cancel or reverse the transaction.
- The sending bank will investigate your request and check whether the transaction has been processed.
- The sending bank will check with the receiving bank if they are accepting the recall of the bank transfer. This will need an authorization from the receiving bank to perform the recall.
- The receiving bank will also need authorization from the beneficiary that the person is agreeing to the recall.
- Once the beneficiary agrees, the bank will be able to complete the recall and get the money back.
As you can see from the process above, the beneficiary had to agree to give back the money. If the bank is unable to get authorization from the beneficiary, even if the transfer was done by mistake, then it will be difficult for you to get the transaction reversed.
Can I Get My Money Back From A Bank Transfer Made Through A US Bank?
If you have a US bank account and you have made a bank transfer recently that you want to recall, you have to check your bank’s terms and conditions whether it is possible to reverse that bank transfer.
To make it easier for you, we listed below the policies of some of the major banks in the United States when it comes to cancelling bank transfers.
| Bank of America | Bank of America states that except for remittance transfers, you no longer have the right to cancel a bank transfer once you direct them to begin processing a transfer or if a transfer is already in process or processed already. It may at its option accept your request to cancel or make amendments to the transaction but the reversal request must be agreed by the financial institution that accepted the transfer. If the receiving institution did not agree to the reversal request, Bank of America will not have any liability. READ HERE for full text. |
| Citibank | You can only cancel or amend a transfer request if the transfer request has been received before Citibank has executed the transfer. If the transfer has been processed already, the reversal request will only be effective if Citibank voluntarily consents to it and if the beneficiary bank agrees that the funds are returnable. Citibank will have no liability if the beneficiary bank does not agree to return the money. READ HERE for full text. |
| US Bank | With US Bank, you can only edit or cancel a bank transfer when it is still in “Pending” status. If the status is already in process, you cannot cancel it anymore. According to an FAQ page from US Bank, they advise asking the recipient to facilitate a transfer of the funds back to your account which will in effect reverse the transfer. |
| Wells Fargo | According to Wells Fargo, a wire transfer is considered as an immediate form of payment, therefore once the recipient obtained the money already, the transfer cannot be reversed even if it is erroneous or fraudulent. |
| Chase | According to the Chase Transfers Agreement, once a transfer has been marked “Sent” or complete then it cannot be cancelled. READ HERE for full text. |
Can You Be Scammed Through Bank Transfer?
Yes. There are many different ways scammers can steal money from you by transferring money from your bank account. In some cases, you may be voluntarily sending the money to their account without you realizing that it’s a scam. Below are some examples of scams you should watch out for.
Fake Online Shopping
With online shopping becoming more popular, there are many fake sellers online offering goods at prices that are way below the market rate. These are usually luxury goods or expensive electronics where they will ask you to make the payment through wire transfer and once you have made the payment, you will never receive what you supposedly purchased.
Relatives in Need of Emergency
Some scammers will send you messages pretending to be your relatives or friends in emergency situations. They will ask you to send them money through a bank transfer due to this emergency.
Fake Lotteries
You may receive a message that you won a lottery or a contest even if you did not join anything. Usually, the scammer will ask you to wire transfer a processing fee before they award you your winnings. This is a scam for you to send them money and you will never receive anything.
Phishing Scams
Unlike the first three instances above where you might have authorized the bank transfer yourself, there are also phishing scams wherein your online banking accounts can be hacked. Usually, you will receive an email or a text message where you will be asked to verify your account or your password. The hackers will use this as a way to hack your online accounts.
A hacker who gains access to your online banking or mobile banking app can then perform unauthorized bank transfers to their own account.
How To Get Money Back After Being Scammed Online?
If you have been a victim of an online bank transfer scam, you might be wondering if it is possible to still get your money back. In most cases, it will be impossible to get your money back if the wire transfer was authorized by you.
For example, you were scammed by a fake lottery company and issued a wire transfer to the bank account of the scammer, that transfer cannot be reversed especially if the scammer already withdrew the money. As discussed earlier, the only way you can reverse or recall the transfer is if the recipient authorizes the recall. Since the recipient is a scammer, he will not obviously authorize to give you back the money.
However, if you have been a victim of a phishing attack and someone has transferred money from your account without your permission, you may be able to get the money back depending on the financial institution you are banking with.
With Chase Bank, for instance, if your password was lost or stolen and there are unauthorized transfers from your account, you can be fully covered if you tell them at once (within two business days after you discover the loss or theft). Otherwise you could lose all the money in your account if you fail to inform them immediately.
Avoiding Bank Transfer Mistakes and Scams
While a bank transfer is a convenient way to send money, it can also be a pain to reverse them if you make a mistake or if you have been scammed. It is very important to be extra diligent and careful before making any transfer to avoid errors. You should also keep your banking details safe and secure at all times.