518Recovery of amounts from financial institutions

518  Recovery of amounts from financial institutions

Notice about payment made to wrong account

 (a) a recoverable amount is paid to a financial institution for the credit of an account kept with the institution; and

 (b) the System Governor is satisfied that the payment was intended to be made to someone who was not the person or one of the persons in whose name or names the account was kept;

the System Governor may give a written notice to the institution setting out the matters mentioned in paragraphs (a) and (b) and requiring the institution to pay to the Commonwealth, within a reasonable period stated in the notice, the lesser of the following amounts:

 (c) an amount specified in the notice that is equal to the recoverable amount;

 (d) the amount standing to the credit of the account when the notice is received by the institution.

Notice about payment made to account of deceased person after their death

 (2) If:

 (a) the payment of a recoverable amount that is intended to be made to or in respect of a person (the first person) is made to a financial institution for the credit of an account that was kept with the institution by the first person or by the first person and one or more other persons; and

 (b) the first person died before the payment or payments were made;

the System Governor may give a written notice to the institution setting out the matters mentioned in paragraphs (a) and (b) and requiring the institution to pay to the Commonwealth, within a reasonable period stated in the notice, the lesser of the following amounts:

 (c) an amount specified in the notice that is equal to the recoverable amount;

 (d) the amount standing to the credit of the account when the notice is received by the institution.

Informing deceased estate

 (3) As soon as possible after issuing a notice under subsection (2), the System Governor must inform the deceased estate in writing of:

 (a) the amount sought to be recovered from the deceased person’s account; and

 (b) the reasons for the recovery action.

Offence

 (4) A financial institution must comply with a notice given to it under subsection (1) or (2).

Defence

 (5) It is a defence to a prosecution of a financial institution for failing to comply with a notice given to it under subsection (1) or (2) if the financial institution proves that it was incapable of complying with the notice.

Note: A defendant bears a legal burden in relation to the matter in subsection (5): see section 13.4 of the Criminal Code.

Reduction of recoverable amount by amount recovered