In June 2012, a massive IT failure affected all of Ulster Bank’s ATMs, and many customers sought to take advantage by making multiple withdrawals of cash which they did not have in their accounts. As I have commented many times on this blog, in the case of overactive ATMs, overpayments, and theft, a bank error in your favour is not a gift from God; an overactive ATM is not santa, and the scrooge bank will have to be repaid; bank errors are not a licence to gamble; and keeping the proceeds of a bank error in your favour can amount to theft.

However, in a recent prosecution of a man who managed to withdraw €13,600 from Ulster Bank ATMs during the IT failure, the judge dismissed the case as the prosecution failed to prove Ulster Bank did not consent to the withdrawals, and the State had failed to prove the bank existed. The defendant was charged with 23 counts of stealing cash, the property of “Ulster Bank Ireland Ltd”, and whilst there was evidence of various entities associated with Ulster Bank, the judge held that there was no documentary proof of a properly incorporated legal entity called “Ulster Bank Ireland Ltd” put before the jury, and he therefore directed the jury to acquit the defendant.…

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In the case of overpayments by an ATM, erroneous overpayments can be recovered by the bank (whether on foot of the bank’s terms and conditions, or pursuant to a restitution claim to recover a mistaken payment), and so must be repaid by the customer. Worse, seeking and retaining the overpayments can amount to theft. As I have said on this site, a bank error in your favour is not a gift from God; an overactive atm is not santa, and the scrooge bank will have to be repaid; bank errors are not a licence to gamble; and keeping the proceeds of a bank error in your favour can amount to theft.

All of this is brought to mind by a story in this morning’s Irish Independent (also Sunday World and 98fm):

Man who withdrew thousands of euro from ATMs during Ulster Bank computer failure avoids jail

… Babatunde Fagbule (46) visited several ATMs around Dublin and Meath on June 22, 2012 and made thousands of euro in withdrawals. By the end of the day the account, which belonged to his wife, was overdrawn by €8,315. … The court heard Fagbule had no right to withdraw more money than was in the account as it did not have an overdraft facility.

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In a famous “community chest” card in the Monopoly board game, if there is a bank error in your favour, then you can collect $£€200. On the card, the lucky customer is pictured almost fainting in astonishment, as a teller presents a wad of notes. Sadly, as with the history of Monopoly, as told by Mary Pilon in her fascinating book The Monopolists: Obsession, Fury, and the Scandal Behind the World’s Favorite Board Game (2015) (Bloomsbury | Amazon), the reality is far more complicated. As I have said on this site, a bank error in your favour is not a gift from God; an overactive atm is not santa, and the scrooge bank will have to be repaid; and bank errors are not a licence to gamble.

That last warning was in the context of “some technical issues” being experienced by Ulster Bank in June 2012, by which some “account balances … [were] not up to date” at ATMs. I specifically commented that any excess withdrawals in such circumstances would have to be repaid. And I warned that such withdrawals often amount to theft. It is not a surprise, then, to read today’s stories of a woman who stole more than €57,000 from various ATMs across Dublin on 22 June 2012 and today pleaded guilty pleaded guilty at Dublin Circuit Criminal Court to ten counts of theft from Ulster Bank.…

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The following story caught my eye in the news today:

Cashier asleep with finger on keyboard launched a €222,222,222 transaction

… a German bank employee … had intended to transfer €62.40 from a retired employee’s account but “momentarily fell asleep” and ended up transferring €222,222,222.22 … which was only spotted and rectified by bank staff hours later.

Sadly for the recipients, the bank was perfectly entitled to rectify the error: as I have said on previous occasions on this blog, the recipients of the €222m would have had to pay the money back. See A bank error in your favour is not a gift from God; Santa, Scrooge, and overactive ATMs; Bank errors are not a licence to gamble.

The terms and conditions of the contracts between banks customers usually allow banks to reverse such erroneous transfers. Even if the contract doesn’t apply, or if the transfer cannot be electronically reversed, there are likely to be non-contractual claims to restitution on the grounds that the customers were unjustly enriched by the mistaken payments. Worse, if the recipients decide that the money would be much better off resting in their other accounts, this would constitute theft. There is no electronic philosopher’s stone that can transmute €62.40 into €222,222,222.22 and leave the recipient secure in receiving the latter amount – unfortunately.…

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The above announcement currently appears on the Ulster Bank home page. It simply says that the bank is experiencing “some technical issues”, as a result of which some “account balances are not up to date” and some “services are unavailable”. When this happened to the Bank of Ireland the Christmas before last, it meant that some of its customers were able to make ATM withdrawals of amounts greater than their available funds or credit. I am not a customer of Ulster Bank. Nor do I know whether their “technical issues” are affecting their ATMs. However, if they are, then – as I said at the time of the Bank of Ireland error and earlier – making excess withdrawals in such circumstances is not a good idea. Those withdrawals will have to be repaid, either by virtue of the terms and conditions of the contract between the bank and the customer, or because of the legal duty to make restitution of mistaken payments received.

Worse, such withdrawals often amount to theft. A story in the Daily Edge stream of the TheJournal.ie today makes the point rather graphically:

Man gets $1.5m in ATM error … and then gambles it away

A DETROIT MAN faces 15 months in jail, and a court order to pay $1.5 million to his bank, after a glitch allowed him to withdraw unlimited cash from his bank account – which he then lost to his gambling habit.

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I wrote before Christmas about overactive Bank of Ireland ATMs. Exactly the same issue has just arisen in Australia:

Consumer groups are calling on the Commonwealth Bank to explain what went wrong with its ATMs on Tuesday, with a glitch resulting in some customers withdrawing excessive amounts from the machines. Police charged two men in Sydney on Wednesday with fraud for allegedly withdrawing extra money from the faulty machines during the meltdown.

As with the Bank of Ireland ATMs, the CBA machines operated in standby mode, but if you take money to which you are not entitled, it may very well constitute theft – and even if it doesn’t, it will certainly give rise to contractual or restitutionary duties to return the overpayments. I have this news via Legal Eagle on Skepticlawyer, who argues that

… the Commonwealth Bank will definitely have recourse to recover the money from individuals who have taken advantage of the glitch in its computer processes, subject to the defence of good faith change of position. It’s my theory that one of the reasons behind the rise of unjust enrichment law is electronic banking and the mistakes which arise therein. Seriously! I’ve spoken before about the paradigm case, Chase Manhattan Bank N.A.

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Well, I mean, yes idealism, yes the dignity of pure research, yes the pursuit of truth in all its forms, but there comes a point I’m afraid where you begin to suspect that if there’s any real truth, it’s that the entire multi-dimensional infinity of the Universe is almost certainly being run by a bunch of maniacs. And if it comes to a choice between spending yet another 10 million years finding that out, and on the other hand just taking the money and running, then I for one could do with the exercise.

Frankie, one of the white mice in Chapter 31 of The Hitchhikers’ Guide to the Galaxy by Douglas Adams

It seems that a New Zealand couple, faced with a bank error in their favour of NZ$10m (€4.5m), similarly decided that they could do with the exercise: they, too, took the money, and ran; David Randall brings the story up to date in today’s Independent on Sunday (substantially reprinted in today’s Sunday Tribune:

On the trail of the 10 million dollar runaways

A month ago, Leo Gao and his girlfriend Kara [Hurring] were like millions of couples around the world as they struggled to pay their bills and keep their business [a filling station] afloat.

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