As a general matter of law, if you receive money paid to you by accident (eg into your bank account or from a defective cash machine), you are liable to repay it. If you know you are not entitled to it, but hang on to it and treat it as your own, that is theft. If you are not certain, you should keep the money aside and NOT SPEND IT until you are sure whether it is yours or not.
The law will protect an "innocent volunteer" who has received in good faith and dissipated money in circs in which they genuinely believe that the money is due to them - eg because they have queried it with the source of the money. If however the money has been turned into something of value - eg a washing machine - the owner of the money can still claim the washing machine back.
However if they are not an innocent volunteer, ie they knew or ought to have known that the money had been paid in error, they will still have to pay it back even if they have spent if and have nothing to show for it. This is what is (erroneously) called by the DWP recovery at common law, but is actually the doctrine of "unjust enrichment". That means you ahve been wrongly enriched at the expense of the rightful owner of the money.
After all, if the bank wrongly credited your pay to someone else's bank account as a result of a computer error, you'd want it back, wouldn't you?
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