4 ms·

Under New York law, someone who sends out an erroneous wire transfer—for example, sending a payment to the wrong account—is entitled to get the money back. But

Under New York law, someone who sends out an erroneous wire transfer—for example, sending a payment to the wrong account—is entitled to get the money back. But the law makes an exception when a debtor accidentally wires money to a creditor. In that case, if the creditor doesn't have prior knowledge the payment was a mistake, it's free to treat it as a repayment of the loan. I wonder if folks here on HN agree with this law or not. It sounds like it could be construed as an unfair rule put in due to lobbying by lenders. Thoughts?

Ekaros 6y ago
I think it's reasonable. If I were lender got repayment early, found another lendee now sometime later original lendee would want the money back. I don't have it anymore and thus can't return it. Should I now be forced myself to lend the sum to cover it? Could that cost more than I make from either transaction?
mmmmmbop 6y ago
I find it fair and agree with it. General case: I receive an unexpected wire transfer from someone I wouldn't expect to pay me. It would be unreasonable for me to expect that the money is fairly mine. Exception: I loan out money to someone and ask them to pay me back no later than one year from now. Six months in I receive a wire transfer for the entire amount back. It's reasonable for me to expect that the money is mine and I'm free to spend it as I like. If now the debtor comes and asks for the money back because their wire transfer was a mistake, I may not even have the money anymore and would be put in a bad spot through no fault of my own.
- bdowling 6y ago
  > If now the debtor comes and asks for the money back because their wire transfer was a mistake... One of the questions here was at what point in time is notice of mistake required. The defendants argued that notice was required prior to funds actually being received. Citibank argued that notice prior to the debt being discharged should be sufficient. The court held that notice should be required prior to the funds being received. In the case of a wire transfer that happens instantaneously, that interpretation essentially eliminates the possibility of giving notice of a mistake.

Ekaros 6y ago

I think it's reasonable. If I were lender got repayment early, found another lendee now sometime later original lendee would want the money back. I don't have it anymore and thus can't return it. Should I now be forced myself to lend the sum to cover it? Could that cost more than I make from either transaction?

mmmmmbop 6y ago

I find it fair and agree with it. General case: I receive an unexpected wire transfer from someone I wouldn't expect to pay me. It would be unreasonable for me to expect that the money is fairly mine. Exception: I loan out money to someone and ask them to pay me back no later than one year from now. Six months in I receive a wire transfer for the entire amount back. It's reasonable for me to expect that the money is mine and I'm free to spend it as I like. If now the debtor comes and asks for the money back because their wire transfer was a mistake, I may not even have the money anymore and would be put in a bad spot through no fault of my own.

bdowling 6y ago
> If now the debtor comes and asks for the money back because their wire transfer was a mistake... One of the questions here was at what point in time is notice of mistake required. The defendants argued that notice was required prior to funds actually being received. Citibank argued that notice prior to the debt being discharged should be sufficient. The court held that notice should be required prior to the funds being received. In the case of a wire transfer that happens instantaneously, that interpretation essentially eliminates the possibility of giving notice of a mistake.