CreditCard Company won't cancel my card and refund me due to Money Laundering rules.

roscob

Hi (1st time poster - please be gentle)

My wife recently got a balance transfer offer through from Barclaycard as an existing customer and we decided to apply for it and she was successful.

She did a balance transfer of the maximum she could transfer (almost £9K to a relatively unused Bank of Scotland Credit Card that had a balance of about -£30 i.e. in credit to £30.
This incurred a BT fee of 2.8% (or something similar) with Barclaycard.

My wife phoned the Bank of Scotland Credit Card to cancel it and get the approx £9,030 refunded to us. Over the years I've done exactly this many times with different CC companies and never had a problem!!!

BoS was advised that this could not be done due to money laundering rules and they could at best send the balance back to Barclaycard.

So instead we wrote them a letter asked for them to cancel the card and refund any monies owed to us by cheque.

My wife received a phone call today from Bank of Scotland CC in response to the letter advising that they would be able to transfer the monies back (to Barclaycard) for us (without a fee - how generous) but they could not refund us due to money laundering rules.

Question -
1. What money laundering rules.....Is this something new?
2. If the amounts were different i.e. if I already owed them £9999.99 and did a balance transfer for £10,000 would they NOT be able to refund me 1p due to money laundering rules?
3. My wife has incurred a balance transfer fee (from Barclays) for a percentage of the 9K that was balance transferred to Bank of Scotland. Surely this 9K belongs to her (not Barclaycard OR Bank of Scotland and if so why can't she get it?

Any advice, past experience & help gratefully received.

Thanks
RoscoB

CLAPTON

it is often against the T&Cs of credit cards to have a positive balance
have you checked what their rules are?

aimzrabbit

have i read this right ?

you opened a brand new barlcaycard account and they gave you a 9k Limit ?

you send the 9k to the royal bank of scotland as 1 balance transfer ?

isnt the offer from barclaycard of 0% so that you transfer onto the barclaycard and get the benefit on the deal

you have transfered from barclaycard to your old card which will now acrrue interest at 9k on your old cards rate ?

rabbit

meer53

Money laundering rules aren't new. If i read correctly, you were trying to get 9k in cash from the BOS card ? This would ring very loud Money Laundering alarm bells i would imagine.

As for the money being your wife's, it's not. It belongs to Barclaycard.

aimzrabbit

if he could get the 9k would it be 9k at a cashadvance fee and then 9k at the cash apr which would be megga money in interest

exel1966

roscob wrote: »

Hi (1st time poster - please be gentle)

My wife recently got a balance transfer offer through from Barclaycard as an existing customer and we decided to apply for it and she was successful.

She did a balance transfer of the maximum she could transfer (almost £9K to a relatively unused Bank of Scotland Credit Card that had a balance of about -£30 i.e. in credit to £30.
This incurred a BT fee of 2.8% (or something similar) with Barclaycard.

My wife phoned the Bank of Scotland Credit Card to cancel it and get the approx £9,030 refunded to us. Over the years I've done exactly this many times with different CC companies and never had a problem!!!

BoS was advised that this could not be done due to money laundering rules and they could at best send the balance back to Barclaycard.

So instead we wrote them a letter asked for them to cancel the card and refund any monies owed to us by cheque.

My wife received a phone call today from Bank of Scotland CC in response to the letter advising that they would be able to transfer the monies back (to Barclaycard) for us (without a fee - how generous) but they could not refund us due to money laundering rules.

Question -
1. What money laundering rules.....Is this something new?
2. If the amounts were different i.e. if I already owed them £9999.99 and did a balance transfer for £10,000 would they NOT be able to refund me 1p due to money laundering rules?
3. My wife has incurred a balance transfer fee (from Barclays) for a percentage of the 9K that was balance transferred to Bank of Scotland. Surely this 9K belongs to her (not Barclaycard OR Bank of Scotland and if so why can't she get it?

Any advice, past experience & help gratefully received.

Thanks
RoscoB

So you've stung yourself in your quest to get your hands on 9K in cash and it's backfired on you ! Ingenious, but what an extremely high risk way of alerting them to your 'deception'.

I'm not surprised they won't let you have the cash. For one it will be in their terms about positive balances and secondly it's very suspicious, hence the AML checks.

Why do you think the 9K belongs to your wife? It's borrowed money from Barclaycard !

Banks/Card Companies/Financial organisations have an FSA responsibility to query or perform additional security checks on large out of the ordinary deposits/transfers etc.

I just moved £20K from MBNA to my bank account. Additional security checks were required to ensure it was a genuine request which slightly delayed the process. Par for the course really.

dalesrider

roscob wrote: »

Hi (1st time poster - please be gentle)

My wife recently got a balance transfer offer through from Barclaycard as an existing customer and we decided to apply for it and she was successful.

She did a balance transfer of the maximum she could transfer (almost £9K to a relatively unused Bank of Scotland Credit Card that had a balance of about -£30 i.e. in credit to £30.
This incurred a BT fee of 2.8% (or something similar) with Barclaycard.

RoscoB

Er... Where is the balance transfer here????

A balance transfer @ 0% is when you transfer funds to the barclaycard you have just taken out... From another credit card with a balance on it...

What you have done is a cash transfer to another card. Which will be incuring interest from day of transfer.

I'm not surprised that BoS have blocked the removal of funds and will only return to source.

sfax

I have done this before for about £2k and was allowed to do it but was warned re. money laundering. You'll do well to find anything in the T&Cs as I couldn't at the time. It's strange because it's not that different in principle to taking out a loan. You get cash, you're left with debt on a credit card. The differnce is that there are two different credit card companies and you involved in this case whereas with a loan, it's just you and the loan company

exel1966

The BT was a standard one from Barclaycard to BOS to try and put that card £9K in credit and then withdraw it in the form of a cheque by cancelling the card.

I would assume when the money gets back to Barclaycard they'll refund the £252 fee.

sfax

dalesrider wrote: »

Er... Where is the balance transfer here????

A balance transfer @ 0% is when you transfer funds to the barclaycard you have just taken out... From another credit card with a balance on it...

What you have done is a cash transfer to another card. Which will be incuring interest from day of transfer.

I'm not surprised that BoS have blocked the removal of funds and will only return to source.

It doesn't work like that. It is a balance transfer at 0% not cash and as per my other post I have done it successfully before to the tune of £2k and was able to close the credit card account (albeit with a slap on the wrist). Whether you should do it or not is another question but it doesn't get treated as cash and you don't get charged interest

InsideInsurance

It is standard guidance that if any refund is to be done it is back to the original method of payment. You transferred money in from BC so if you want a refund the refund must also go back to BC.

As with most UK legislation the actual "law" is very imprecise and doesnt say that you must do X when Y happens. It instead talks about due diligence and appropriate measures etc, what exactly these mean would need to be tested in court.

Even if you look at the HMRC guidance on anti-money laundering for small businesses https://www.hmrc.gov.uk/mlr/mlr_msb.pdf you will see it is all theory with little practical application