Refund lost between merchant and bank, what to do?

LokiOfNZ

Hi all

So over a year ago we ordered a kitchen from one of the big kitchen merchants and put down a fully refundable deposit.

A couple of months ago we finalised a plan to move house instead so called them up to cancel the order and refund the deposit, which they happily agreed to do without a problem. They processed the refund at the start of Sept back to the credit card we'd paid with.

Unfortunately what I had forgotten was that the credit card we'd paid with was one we'd cancelled some 10 months previously. In fact we closed all our accounts with that bank and thus currently have no relationship with them.

After waiting a few weeks for the money to appear in one of our current accounts I realised the issue and have now spent another several weeks going back and forth between the merchant and the bank trying to find out where the money is and how I can get it.

The merchant says the money will be in a holding account at the bank and have supplied me with an ARN number for the bank to track it down. They seem to think this is 'helping me out' since from their point of view they've done all they need to do.

The bank says the payment will have bounced back to the merchant immediately but did spend a week with the ARN number before saying they can find no trace of the money. They think they've done all they need to do as they say that absolutely don't have the money.

So ... now what? All the merchant says is here's an ARN number, get the bank to trace it. All the bank says is we don't have the money, get the merchant to trace it.
What am I suppose to do about it now? I feel I've been very patient and despite my initial mistake of forgetting the card was cancelled I also feel like I've been helping the merchant out (not the other way around) by speaking to the bank about 6 times now and trying to trace where the money went.

At the end of the day, the money is mine but at no point has that money been in my possession. Where the merchant sent it and what happened to it is beside the point, it never arrived with me so I feel they still owe me that money. Am I wrong?

Besides getting frustrated on the phone with the poor operators doing their job, what course of action am I suppose to take now? It's not a small amount of money so I can't just forget about it and chalk it up to a win for 'the system'.

Ben8282

You paid by credit card.
You closed the credit card account.
You closed all accounts wit the bank.
You had the amount refunded to the credit card account.
You no longer have a relationship with the bank.
You were waiting for the money to appear in one of your current accounts.
Solution:
Ask merchant to provide you with a copy of the transaction receipt for the refund.
Forward it to credit card department of bank with a simple letter of explanation. Avoid mention of ARN numbers or anything else beyond the facts. A refund was made to my closed credit card account number XXXX. I enclose copy of the transaction receipt. Please arrange a refund to me by cheque.
End of story.

born_again

If you can get proof that the retailer has refunded.
So you need.
Date of refund, Amount of refund & last 4 digits of card used.
You can then you that as a dispute for non receipt of refund.

Given the card provider said it was bounced back after checking the ARN. Then odds on it is sat back with the retailer in one of their or their banks holding accounts.

Terry_Towelling

We've had a few of these sorts of issues over the months and I suspect (but can't be sure) you are being fobbed off by your bank. Any credit card company worth its salt would not automatically 'bounce' a refund. In fact, you can't actually 'bounce' a refund without leaving a trace of that 'bouncing'.

The process of 'bouncing' would be to raise a (credit) Chargeback to the retailer's processing bank.

The fact you have been given an ARN is a positive point. It is not a guarantee that the refund got through to your bank from the retailer's bank, but it is more than 99% certain that it did. This number will identify the bank that processed the refund and the date that they processed it through to Visa/MasterCard. Together with your old card number, that provides ample information for your bank to trace the incoming credit and to tell you exactly what they did with it and when they did it.

So, if they did 'bounce' the refund, they can tell you exactly how and when they did it; I certainly regard it as unacceptable for them to simply say they 'bounced' it without actually providing any proper evidence and a full explanation.

I think you will probably need to raise a formal complaint to your (ex)bank to get them to properly investigate, and, if the refund was bounced, they will then have to provide you with some evidence of this.

The possibility of requesting a Chargeback for Non-Receipt of Refund could be problematic because your bank would probably need to resurrect your old account and locate the ARN of the original debit to make the Chargeback. Given the way they've talked about your old account so far, I suspect they'd struggle to do this as it probably falls outside of the experience of their front/back office staff.

For your information, the ARN should be 23 digits long. Ignore digit 1. Digits 2 - 7 identify the retailer's processor (a bit like a sort code). Digits 8 -11 will tell you the date the refund was sent for processing through Visa/MasterCard. Digit 8 is the last number of the year of processing - this should be an 8 in your case. Digits 9 -11 represent the day of the year as a sequential number - i.e. 001 is 1st January and 365 is 31st December. In your case this should be somewhere between 244 and 274 if it was in September.

Good Luck!