I don't get why people would do this ... don't the bank just put their account into a negative balance?

I read about another case in australia where an ATM was issuing $50 notes in place of $20 notes so once word got out a ton of people turned up to withdraw $80 - it came out as 4 x $50s = $200 ... but they were also asked to pay it back to the bank...

http://www.couriermail.com.au/news/commonwealth-bank-atm-dis...