Payment that was not credited to the sender’s account after rejection by the recipient bank

The client transferred from his account at Bank A several amounts to his account at Bank B. Bank B subsequently blocked his account because it wanted to clarify the background to these transactions with the client. It did not want to authorise any more transactions until the outstanding issues had been clarified. While the account was blocked, two further similar incoming payments of around USD 6,000 each were rejected by Bank B. However, the amounts were not immediately credited back to the client’s account at Bank A. In the case of one of the transfers, this was the case only after two months, while the second transfer had still not been credited back after five months. As Bank B declared that it would cease its investigations, the client approached the Ombudsman. While examining the documents submitted to him by the client and Bank B, the Ombudsman recognised an anomaly in a communication from the correspondent bank of Bank B. He asked the latter to check this with the respective correspondent bank. The missing amount was found during this check and could be credited back to the client’s account with Bank A.

The client complained to the Ombudsman that Bank B had stopped still looking for the money, which it had returned to Bank A and which was still missing. Bank B refused to make any further enquiries and took the view that it all had done all it could reasonably do to find the money. The client took the view that Bank B, which had blocked his account had and rejected the incoming payments, had to prove that the money had been transferred back to Bank A, where he held the sender account. It was in his view the responsibility of Bank B to clarify the matter with the correspondent banks involved.

Although the payments ordered by the client were made from a bank in Switzerland to another bank in Switzerland, two American correspondent banks were involved because the amounts were in USD. Four banks were therefore involved in the transfers: Bank A and its correspondent bank as well as Bank B and its correspondent bank. In the case of misdirected transfers, clarifications must always be made by the sender bank (i.e. in this case Bank B, which had transferred the amounts back) along such a banking chain. The Ombudsman was therefore also of the same opinion that it was the responsibility of Bank B to make the necessary clarifications via its correspondent bank.

In response to his intervention, Bank B explained that it had clarified the matter with its correspondent bank. The latter stated that it had forwarded the money to Bank A’s correspondent bank. It repeated that it could therefore no longer take any action in this matter. The money was now in Bank A’s sphere of influence, and Bank A would have to deal with the matter together with its correspondent bank.

In its reply to the Ombudsman, Bank B enclosed documents relating to both return transfers that it had received from its correspondent bank. These were documents relating to both rejected payments, i.e. the one that was credited back after 2 months and the one that could no longer be found. On closer examination of these documents, the Ombudsman found differences in the wording of the two communications from the correspondent bank. The documents for the credited payment had a specific reference to the fact that the amount had been forwarded from the correspondent bank of the recipient bank to the correspondent bank of the sender bank. This reference was missing from the documents relating to the missing payment. The Ombudsman suspected that the absence of this reference could indicate that the missing money was still at the correspondent bank of Bank B and asked the latter to clarify with its correspondent bank why this reference was missing in the message relating to the missing payment and whether the assumption that the money had been stuck at the correspondent bank of Bank B was possibly correct.

The recipient bank informed the ombudsman shortly afterwards that its further enquiries had revealed that the missing amount had now been forwarded by its correspondent bank to the correspondent bank of Bank A and credited to Bank A from there. The ombudsman informed the customer of the happy outcome of the matter and asked him to check whether the missing amount had actually been credited to his account. The ombudsman heard nothing more from the customer and therefore assumed that the problem had been resolved.