Some Scottish Widows customers are being asked to repay thousands of pounds in windfall payments, the BBC has learned.

More than 1.5m policy holders got payments averaging �5,700 when the insurance and pensions provider was taken over by Lloyds TSB last year.

Some were overpaid at the time because of a mix-up in the company's records.

Scottish Widows now wants these customers to pay back the money immediately, saying that it was never rightfully theirs.

About 200 Scottish Widows customers have been contacted with a request to return some of their windfall, BBC Radio 4's Money Box programme has learned.

Already spent

Among them is Martin Brennan from the West Midlands, who is being asked to return almost �3,000 of windfall money he received last September.

Mr Brennan has already spent the cash, which he believed was rightfully his.

According to consumer lawyers, customers who still have undue windfall money in their bank accounts should pay it back.

But they said people who had already spent the money and would suffer hardship in having to repay it should not be forced to do so and should be protected by the law.

Scottish Widows has said that it wants to recover the money so that other investors do not suffer from its overpayment mistakes.

But the company has declined to say how much money it is seeking to retrieve.

Bumper payouts

The purchase of the life insurer by Lloyds TSB in June 1999 triggered a windfall bonanza for more than 1.5m customers.

The bumper payouts resulted from Scottish Widows' jump in value from �6.7bn to �7.3bn.

Of this, �5.8bn was supposed to be paid by Lloyds TSB as windfalls to Scottish Widows customers.

Scottish Widows followed a host of other mutual life insurers that accepted takeover bids resulting in windfalls, including Scottish Amicable, Clerical Medical, Scottish Mutual and NPI.

The takeover ended 184 years of independence for the company, set up in 1815 to look after the widows and orphans created by the Napoleonic wars.