Recourse for a Direct Deposit to wrong bank account | Page 2 | Income tax filing | Discussion forum

I would contact the bank and ask them to contact the client who erroneously received the funds. Hopefully the recipient will agree in good faith to return the money that is not theirs. If they keep the money knowing it is not theirs, it's equivalent to theft. If that doesn't work and it's worth the time and effort, there's always small claims court.

Of course you will need your bank's cooperation to do this.

I don't know what can be done about this situation, but, in an age where I can walk into any branch of either of my big banks and transact business (including transferring registered plans), it seems disingenuous to say that one branch can't contact another to help address an error.
Of course, they can! It's a question of whether they are willing to do so. Apparently not.

frugal lady said
My daughter in law ...................made a typo of the branch number and funds owing her have in fact been deposited to someone else's account
Is there any hope of the funds being retrieved? Any advice?  

Has the error been corrected on the CRA site to prevent further misdirections?

Has the issue been escalated to higher bank management for consideration?

Does the amount of money justify more drastic action than simply correcting the account information on the CRA site?

What outcomes have occurred so far, if any?

Stephen

The originator of the direct deposit, CRA, needs to initiate action.

No way the daughter-in-law's bank will remove the funds from the unintended recipient's account at another branch if that account matches the transit and account number in CRA's direct deposit item.

The bank may not even be able to reveal that the other account received the funds because of privacy rules.

Had the item been a paper cheque, it is still the issuer of the cheque, not the intended recipient, that needs to initiate the action. This is from a letter from RBC:

November 14, 2022

To whom it may concern

Subject: Information related to cheque fraud claims “intended payee not paid”

Dear sir, madam,

It was brought to the attention of the bank that you wanted clarification and guidance on how to claim and report a problem with a cheque that would have been incorrectly cashed by RBC.

Such unfortunate situations need to be individually reviewed by the issuer of the cheque, with support of the financial institution where the cheque is drawn from. If you have a cheque that was made payable to you, but it was cashed by someone else, then recourse is possible by reaching out to the cheque issuer and they will do the necessary with their own financial institution to initiate a “chargeback” for RBC to review.

A declaration form needs to be complete for each and every single cheque claimed. On page 30 of the document issued by Payments Canada, rule A4, a template form is provided. …

What Norman1 says is true, as far as it goes. But this doesn't mean the bank branch she deals with can't know anything about the erroneous deposit. And it doesn't mean they can't provide helpful advice based on what they know. It's their choice.

I would agree though that it is CRA that will have to act. They have to find out what went wrong since, at present, it appears they are aware that the money went to another account.

One might wonder whether any unintended recipient would have the cojones largos to deny a request from CRA to return undeserved funds...
RetirEd

I was successful at fixing this problem for a client, it took a few months though. You need to phone the CRA and get an agent to complete a T105 form. I think when you phone the CRA it would be best if you asked to speak to a supervisor.

I think it would be better to open a Tangerine chequing account and set up the pre-authorized debits against the chequing account.

There have been reports that pre-authorized debits against a Tangerine savings account work. But, it is not an official feature of the savings account.

One can only obtain a direct deposit form for the savings account and not a void cheque. For the Tangerine chequing account, one can request both a direct deposit form and a void cheque.

frugal lady said
she made a typo of the branch number and funds owing her have in fact been deposited to someone else's account. Her Bank says there is nothing they can do.
 

I find it strange that a bank would assign identical account numbers for different branches.

cgouimet said

I suppose that's why the routing includes 3 codes ... FI, Branch and Account.  

Yes, but errors like this would be avoided with unique account numbers.