IBAN transfer rejected but money never returned

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room305

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Over a month ago I transferred a 4-digit sum from my own BOI account to an account (not mine) in Germany. Through my own ineptitude I screwed up the form and put the wrong beneficiary name. As a result, the transfer was rejected and never received by the intended beneficiary.

Since then I have made a seemingly endless number phone calls to BOI to try and rectify the situation with zero progress. They say the beneficiary bank is sitting on the money and ignoring all of their requests to return it. They claim there is absolutely nothing they can do and it may take several months to resolve.

So wondering if anyone here can give me some pointers? I presume these transfers are governed by EU regulations. It is a bad state of affairs when you are left wishing you had stuffed a bunch cash in an envelope and entrusted An Post to deliver it.
 
Brendan said:
Check out howbankingworks.ie and you might get some ideas.

Brendan
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Thanks Brendan, just having a look over now.

UPDATE: Unfortunately there doesn't seem to be anything I can use there as it doesn't detail what happens when SEPA transactions go wrong (e.g. timeframe in which money should be returned etc.).
 
A far as I know BoI are correct and there isn't much they can do if the German bank sits on the money. What you could try to do is contact the German bank directly yourself, either by phone or by email - you will probably be able to chase it better than BoI
 
Can BOI not send an instruction to amend your incorrect payment details you used? Then the German bank could correctly apply your payment
 
efm said:
A far as I know BoI are correct and there isn't much they can do if the German bank sits on the money. What you could try to do is contact the German bank directly yourself, either by phone or by email - you will probably be able to chase it better than BoI
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The beneficiary of the money did indeed contact the German bank (Deutsche Bank) and they confirmed to him that they did not have the money. They said that rejected payments are transferred to a separate account and it is swept at the end of each banking day.

Spent last night reading through a rather boring document entitled "Single European Payment Area Credit Transfer Scheme Rulebook". Available [broken link removed] (warning large file approx. 5Mb).

Reading through the process it would appear my transaction is classified as a "return" rather than a "reject" payment. This is because the payment has passed through the clearing house system but is then returned by the beneficiary bank for the reason of the account number and beneficiary name not matching.

A 'Return' occurs when a credit transfer is diverted from normal execution after interbank Settlement, and is sent by the Beneficiary Bank to the Originator Bank for a credit transfer that cannot be executed for valid reasons such as wrong account number or account closed with the consequence that the Beneficiary account cannot be credited on the basis of the information contained in the original credit transfer message.

The main characteristics of a Return (DS-03) are:

• the transferred amount will be the Original Amount of the Credit Transfer Instruction
• the Return message is routed through the same path taken by the original credit transfer (unless otherwise agreed between the Beneficiary Bank and the Originator Bank), with no alteration of the data contained in the original credit transfer. In the case of a 'Return' message to be sent to the Originator by the Originator Bank, the parties may agree a specific mechanism which may differ from the original path
• a record of the relevant data relating to the initial credit transfer, sufficient to provide an audit trail, is included
• the initial credit transfer is identified by the original reference of the Originator Bank
• 'Return' messages contain a reason code (attribute AT-R3, see below)
'Return' messages initiated by the Beneficiary Bank must be transmitted to the Originator Bank within three Banking Business Days after Settlement Date.
It is recommended that European Interbank Compensation Guidelines (reference [8]) are applicable and are used.

The Beneficiary Bank must send the 'Return' message to the Originator Bank through the selected CSM at the latest three Inter-Bank Business Days after Settlement Date “and at the same time return the Funds.

The Originator Bank must credit the Originator’s account according to the timing agreed with the Originator, and make the appropriate details available to the Originator
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Certainly something is awry. Question is, where can complaints be directed?
 
sharecarer said:
Can BOI not send an instruction to amend your incorrect payment details you used? Then the German bank could correctly apply your payment
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That was the original plan and it was apparently tried but rejected on "data protection grounds". After this the bank said they would simply recall the money.
 
This reminds me of a conversation I recently had with a fraud investigator.

Sorry to go off topic slightly.

He was saying that once money has (fraudently) left an Irish bank and been received abroad, the non-Irish bank generally won't cooperate when it comes to trying to reclaim the money.

He's had cases of people stealing millions from their employer (generally people who work in the accounts department of large multinationals) and never once has he been able to reclaim the money due to the accounts person having trasnferred the funds abroad (i.e. the non-Irish bank won't cooperate.)

As an added twist, the large multinationals don't prosecute the fraudsters due to the bad publicity being worse financially than the amount of money stolen.

This is common apparently.

What I'm trying to say is, international banks don't give a damn, so you may have some difficulty getting your money back.
 
room305 said:
So wondering if anyone here can give me some pointers? I presume these transfers are governed by EU regulations. It is a bad state of affairs when you are left wishing you had stuffed a bunch cash in an envelope and entrusted An Post to deliver it.
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There's a raft of new regulation coming down the line called the Payment Services Directive - I think it'll be included in that. No consolation in the present situation, though
 
Thanks everyone for the replies. Finally, got the money back, coincidentally (I hope) after an email requesting that they pass on all information pertaining to the transfer so I could "investigate further courses of action". It was being held by ABN Amro apparently (so the beneficiary was correct in stating that it was not being held by Deutsche Bank). The reason it was being held by ABN Amro was because BOI have no direct link to Deutsche Bank and so have a commercial partnership with ABN Amro for transfers to DB.

So it would appear that they money was received by Deutsche Bank and rejected and ABN Amro stopped the return payment and held it for nearly two months with no explanation why.

I'm delighted to get my money back but more than a little disturbed by the whole process. I won't be using BOI's international transfer service again. Their branch staff were as helpful as possible in dealing with my incessant calls but they genuinely didn't seem to get any information from the international payments department beyond "we don't have it".
 
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