mistake by firm costs client money - what is redress for client

mistake by firm costs client money - what is...

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An overseas client who uses other accounting firms for some of her business interests has asked me an interesting question. The client had substantial client money sitting in the accounting firms client account in Sterling Pounds. She requested the Sterling Pounds balance in the client account to be transferred back to her multicurrency account in Singapore with precise instructions to remit GBP Sterling Pounds. However the accounting firm made a mistake and transfered in Singapore Dollars, the firm has admitted it's careless mistake, which has resulted in a significant exchange loss for the client. The client found out immediately and changed back to Sterling Pounds with a nearly £4K exchange loss. If the client had not made the conversion back to Sterling the loss would have been even greater today. What is the client's redress. My understanding is that client knows the accounting firms principals (though the firm has only started acting for her in the last 3 years or so) going back a few years and the firm is still acting for her at the moment and some members of her family know the accounting firm's principals on a social basis. So potentially awkward social situation.

She has asked the firm what they will do about the loss a couple of days ago but hasn't received a response as of yet. She has asked me how she can be re-imbursed her loss without making things awkward with the firm - she would still like to continue to use their services but as she has not done anything wrong and the other accounting firm has admitted their careless mistake - she feels that she should be reimbursed. Her thoughts are money is money.

We would welcome any thoughts on how to handle this diplomatically and I can pass these suggestions on to my client and where she stands - and has anyone ever come across a similar type of situation.

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By Richard Willis
27th Oct 2011 10:09

I would say something like

'I am sure niether of us would wish to spoil our (longstanding) relationship by us having to take legal action against your firm so look forward to receipt of £ within fourteen days from the date of this letter.'

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Replying to morgani:
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By Kev70
28th Oct 2011 16:54

before sending letter

Richard Willis wrote:

'I am sure niether of us would wish to spoil our (longstanding) relationship by us having to take legal action against your firm so look forward to receipt of £ within fourteen days from the date of this letter.'

 

Thanks Richard - that's a great way to essentially press the button before going nuclear.  Would you or anyone else have any thoughts on how to approach the matter prior to this letter.  I am conscious my client is not trying to pussyfoot around but is genuinely thinking of handling this in a mature way before going nuclear or pre-nuclear. 

I suggested the letter idea to her and she would like to be a bit more polite through say a  verbal conversation but she doesn't know what to say and I am also stumped on what to advise her.

I am conscious that if I ever made a mistake like this - I would be obliged to make good to the client as I had been careless and negligent, so I would be immediately upfront to the client that we have made the mistake and here is the refund. 

She has said that if she was dealing with a much larger and firm where she didn't know the firms partners socially she would have no qualms demanding the refund due to the mistake.

Bottom line she finds this to be an this is an awkward situation - she would like to resolve diplomatically - before resorting to a pre-nuclear and then the nuclear option.

Any and all thoughts would be welcome

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By morgani
28th Oct 2011 17:06

Surely if she knows them personally then phoning them up to have a chat about it should be easier.  Just give them a call and ask what their thoughts have been on how she will be reimbursed.  She can casually find out there actions, chasing it up will show she is serious about wanting it sorted.

She knows them and apart from having and idea of her opening line and overall outcome personally I would just let the conversation flow.  After all she knows them and how best to approach them.

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Replying to k743snx:
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By Kev70
28th Oct 2011 19:43

chasing up - Surely she knows them

Thanks morgani,

Very well put. I have kind of had similar thoughts (and communicated the same to my client) - but you have put it well in succinct form. Thanks I will update this thread on the outcome.

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