diff --git a/mutiny-wasm/src/indexed_db.rs b/mutiny-wasm/src/indexed_db.rs
index 5ab597602..cc0732b57 100644
--- a/mutiny-wasm/src/indexed_db.rs
+++ b/mutiny-wasm/src/indexed_db.rs
@@ -114,7 +114,7 @@ impl IndexedDbStorage {
 
             // if we hae an override mnemonic, then we need to check that it matches the one in indexed db
             if override_mnemonic.is_some_and(|m| m != seed) {
-                panic!("Mnemonic already exists in indexed db, cannot override");
+                return Err(MutinyError::InvalidMnemonic);
             }
 
             seed
diff --git a/mutiny-wasm/src/lib.rs b/mutiny-wasm/src/lib.rs
index 504ace2b9..e557fc9cd 100644
--- a/mutiny-wasm/src/lib.rs
+++ b/mutiny-wasm/src/lib.rs
@@ -163,8 +163,7 @@ impl MutinyWallet {
 
         let mnemonic =
             IndexedDbStorage::get_mnemonic(override_mnemonic, password.as_deref(), cipher.clone())
-                .await
-                .map_err(|_| MutinyJsError::IncorrectPassword)?;
+                .await?;
 
         let seed = mnemonic.to_seed("");
         let xprivkey = ExtendedPrivKey::new_master(network, &seed).unwrap();
@@ -1601,6 +1600,61 @@ mod tests {
         uninit().await;
     }
 
+    #[test]
+    async fn fail_to_create_wallet_different_seed() {
+        MutinyWallet::new(
+            None,
+            None,
+            None,
+            Some("regtest".to_owned()),
+            None,
+            None,
+            None,
+            None,
+            None,
+            None,
+            None,
+            None,
+            None,
+            None,
+        )
+        .await
+        .expect("mutiny wallet should initialize");
+        super::utils::sleep(1_000).await;
+        assert!(MutinyWallet::has_node_manager(None).await);
+        uninit().await;
+
+        let seed = mutiny_core::generate_seed(12).unwrap();
+        let result = MutinyWallet::new(
+            None,
+            Some(seed.to_string()),
+            None,
+            Some("regtest".to_owned()),
+            None,
+            None,
+            None,
+            None,
+            None,
+            None,
+            None,
+            None,
+            None,
+            None,
+        )
+        .await;
+
+        match result {
+            Err(MutinyJsError::InvalidMnemonic) => {}
+            Err(e) => panic!("should have failed to create wallet with different seed {e:?}"),
+            Ok(_) => panic!("should have failed to create wallet with different seed"),
+        }
+
+        IndexedDbStorage::clear()
+            .await
+            .expect("failed to clear storage");
+        uninit().await;
+    }
+
     #[test]
     async fn fail_to_create_2_mutiny_wallets() {
         log!("trying to create 2 mutiny wallets!");