Bank Support: When A Bank Errors in Your Favor

Discover the keys to financial success in banking! Learn what happens when a bank errors in your favor, managing Social Security benefits after a passing, and the importance of credit freezes. Questions? Reach out to our expert, Alex, at alexexpertbanker@gmail.com. Your queries will be featured on our site with Alex’s timely and insightful answers.

Question: What should I do if the bank makes an error in my favor?

Asked by: Trevor from Paterson, New Jersey.

Answer: When a bank erroneously deposits extra funds into an account, it may seem like good fortune. Unfortunately, those funds do not belong to the account holder. Bank errors typically stem from human mistakes or technical glitches. This can include depositing the wrong amount, duplicating a transaction, or crediting funds to the wrong account. While it may be tempting to keep unexpected money, failing to report the error could have serious legal consequences, such as charges of fraud or theft. Upon identifying an error, the bank has the authority to reverse the transaction. If the funds have already been spent, the recipient who receives it in error must repay it. If a customer finds an error in their account, they should promptly inform the bank. It is important to keep records of all communication and transactions related to the error and follow up with the bank until the issue has been resolved.

Question: What happens to someone’s Social Security benefits when they pass away?

Asked by: Janice from Sarasota, Florida.

Answer: When someone who receives Social Security benefits passes away, their benefits stop immediately. Any payments made after their death must be returned to the Social Security Administration (SSA). Funeral directors typically inform the SSA of the recipient’s passing, ensuring no more checks are sent. However, there are cases where payments are mistakenly sent after the individual’s death, requiring them to be returned through the SSA contacting the bank. This communication also alerts the bank of the account holder’s demise. To ensure a smooth process, it is advisable for family members or representatives to promptly notify the SSA of the deceased individual’s passing. This action stops future payments on time and prevents complications. Surviving spouses or eligible family members may qualify for survivor benefits, but they must contact the SSA to understand their entitlements and the steps to claim them.

Question: Why should I place a credit freeze?

Asked by: Rusty from San Diego, California.

Answer: Initiating a credit freeze involves contacting the three major credit bureaus, Experian, Equifax, and TransUnion, via online, phone, or mail. Online or phone requests freeze the credit report within one business day, while mail requests freeze it within three business days. When a creditor or lender attempts to access the credit report, they will obtain a message stating that the file is frozen and that they are unable to pull the information. This prevents any new accounts from being opened, as lenders will typically not approve credit without checking the applicant’s credit report. Placing a credit freeze is a crucial step in protecting against identity theft. When a credit report is frozen, it adds an extra layer of security and makes it significantly more challenging for fraudsters to open new credit accounts under their victim’s name.

Written by: Alex Sanchez

Important: For your specific questions about banking, contact your banking expert, Alex, at: alexexpertbanker@gmail.com

About our Author: With nearly 20 years of experience in the banking industry, Alex is currently a branch manager with First Interstate Bank. Throughout his career, he has contributed his expertise to renowned financial institutions like Bank of America, US Bank, and Chase. He also has a bachelor’s degree in Business Economics from the University of California, Riverside.

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