It was a case that caused many Guardian Money readers’ jaws to drop: the hairdresser who lost £26,000 after discovering that for two years she had been transferring her monthly salary into someone else’s account – and they had spent it.
In May 2010, Sally Donaldson logged on and arranged for her £1,000-a-month pay to be transferred from her HSBC account to the Nationwide account she shares with her partner. But she incorrectly typed in one of the eight digits in the account number. Only in October 2012 did Sally spot her calamitous error, by which point £26,650 had gone into another Nationwide customer’s account.
So, two years on, has Sally managed to get any of her money back? We caught up with her, and she revealed that:
• So far she has recovered just £800 from the woman who took her cash and spent it, whom we will call Laura;
• She has racked up solicitors’ bills totalling £2,500 (and counting) in her pursuit of Laura;
• She and her partner are currently seeking a charging order on Laura’s home so that it can’t be sold without this debt being repaid.
Accidentally getting one of the numbers wrong when you are transferring money from one bank account to another is horribly easy to do. Often that split-second error will result in your money being sent to the wrong account-holder. But what made Sally’s story so extraordinary was the length of time between her making her slip-up and spotting it. For more than two years, her pay was going into someone else’s account. Many people were left wondering how on earth she and her partner failed to notice a missing £1,000 every month, though Sally says she didn’t see a bank statement from Nationwide for the entire period, as she had recently switched to paperless statements. Her partner, who also paid his income into the account, sorted out most of the bills.
In our original article published last year, we explained that Nationwide did manage to retrieve the final payment, but the rest of the cash had gone – Laura had withdrawn it via ATMs, spent the cash, and was refusing to repay it. To make matters worse, Nationwide said there was nothing it could do, and it wouldn’t tell Sally who the recipient was because of data protection rules.
During the 21 months since our article, Sally and her partner have continued to try to get their money back. Nationwide refused to help, other than suggesting they contact Citizens Advice or make a complaint to the Financial Ombudsman Service. So in the summer of 2013 the couple applied for, and obtained, a court order called a “Norwich Pharmacal” order to force the building society to hand over Laura’s name and address.
Once Nationwide released this information, the couple’s solicitor wrote to Laura and an agreement was eventually reached that she would start paying back the money at a rate of £100 a month – or more than that, if and when her circumstances permitted it.
Sally says that, based on the information passed to them by Citizens Advice, which helped Laura set up the repayments, it was clear she wasn’t in a position to pay the whole sum back immediately, and that £100 a month was probably the most she could afford.
Laura has a grown-up child living with her, and the household receives disability living allowance; she apparently told the solicitor that she hoped to be able to finish paying back the money “within a few years”.
Sally says: “While this was a precarious situation for us to be in, it was some good news in that Laura had admitted she had acted wrongfully and had unlawfully spent our money.”
She adds that she does have a small amount of sympathy for the woman who took her cash: “I can see that in her circumstances the money would be tempting, but she did the wrong thing.” However, she says that in her partner’s view, “there is no doubting it: she spent money that clearly wasn’t hers”.
Sally firmly believes Nationwide should have stepped in to help both parties – for example, by taking on the debt and setting up a repayment plan so Laura could pay back the society rather than the couple. This would have meant Laura wouldn’t have been dragged into a court case, and Sally wouldn’t have had to continue racking up legal costs.
“Looking back, it became clear that Nationwide, once confident that this error of one digit was not of its making, walked away from the problem without any help being offered at all. I received a phone call (not even a letter) in October 2013 stating that their position remained the same, and that they were not able to help any longer … the case was, in their eyes, closed.”
But, more recently, the couple suffered a setback: Laura failed to make one of her monthly payments, prompting them to take “more decisive action”. Sally and her partner are now seeking a charging order on Laura’s house. If this is granted, it would mean the property can’t be sold without the debt being repaid, with expenses and interest. In other words, if and when Laura sells the house, she has to pay Sally first. If Laura hadn’t owned a property, the couple would have had very few options.
“Getting this far has been a trial, and we feel there is a lot more to come. Laura has stopped replying to, or acknowledging, any letters from our solicitor, so getting to court is going to be a slow process, and we just hope the order on her house goes through without a hitch.
“All of this could have been avoided if Nationwide had acted with a bit more customer focus and compassion. Instead, we’ve been left to find our own way, with only the smallest sign of progress so far – only £800 has been repaid.”
It also emerged this week that Laura claims she went into a Nationwide branch back in 2010 to report that money had started appearing in her account. Internal Nationwide emails reveal she claims a member of staff told her the payments “were for her” – but the society says it was only after it wrote to Laura to ask her to repay the money that she mentioned this. “We investigated this claim at the time she made it [in 2012], and could not find any evidence of her having alerted us. If she had, it would have triggered a process that would return the payment to the sending bank,” the society told us.
Sally Donaldson is not her real name, as she wishes to remain anonymous. “We haven’t told a soul about all this, apart from the solicitor, because I don’t want anyone to know. We haven’t mentioned it to any of our family or friends.” They are not rich – she is still working as a hairdresser, while her partner works in the public sector, and they describe themselves as living “a very modest, sustainable life”. Laura’s name is also a pseudonym.
Nationwide says that as soon as it became aware of the situation it acted to recover the funds: “Unfortunately, only £1,000 was remaining in the recipient’s account, which was ring-fenced and returned. The recipient … advised us she had spent the funds and was not in a position to repay the money.
“We advised the couple to obtain legal advice in order to reclaim the remaining funds. Due to data protection we could not release details of the recipient until they acquired a court order. Once the court order was received we promptly released the details to their solicitor.”
The society adds: “While we sympathise with the situation [Sally and her partner] find themselves in, no error has been made by the society, so it would be inappropriate for us to accept the debt. This could lead to similar claims, some of which may be fraudulent. The case has been reviewed by the Financial Ombudsman Service, which has agreed that Nationwide has taken all appropriate steps to help them reclaim the funds.”
