Refund from PayPal to closed Tesco Bank account - help!

Charliebonk

Hi,

Back in February 2021 I bought some concert tickets through PayPal which took the money from my Tesco current account debit card.  The concert was for this year.  Unfortunately in April of this year I had to cancel and I got a refund from the concert organiser.  This went back to PayPal who then refunded the money to Tesco Bank.  However, at the end of last year (2021), Tesco closed all its current accounts.  PayPal claim that the transaction went ahead successfully and I have a transaction ID.  Tesco Bank claim that they did not get this money.  Due to some poor customer service from Tesco Bank I made a complaint and three weeks later they have come back and said that they have investigated the matter, no money was refunded to them, but they will compensate me £75 (the refund was for £100).  They will not investigate further and I should speak to PayPal.  
What should I do next, I have written to PayPal to ask for further clarification.  
Should I take this matter to the Financial Ombudsman or is there something else I can do first?  I wonder why Tesco Bank would offer me that amount in compensation if they claim that they did not get the refund money.

longjohnjohnson

Charliebonk said:

Hi,

Back in February 2021 I bought some concert tickets through PayPal which took the money from my Tesco current account debit card.  The concert was for this year.  Unfortunately in April of this year I had to cancel and I got a refund from the concert organiser.  This went back to PayPal who then refunded the money to Tesco Bank.  However, at the end of last year (2021), Tesco closed all its current accounts.  PayPal claim that the transaction went ahead successfully and I have a transaction ID.  Tesco Bank claim that they did not get this money.  Due to some poor customer service from Tesco Bank I made a complaint and three weeks later they have come back and said that they have investigated the matter, no money was refunded to them, but they will compensate me £75 (the refund was for £100).  They will not investigate further and I should speak to PayPal.  
What should I do next, I have written to PayPal to ask for further clarification.  
Should I take this matter to the Financial Ombudsman or is there something else I can do first?  I wonder why Tesco Bank would offer me that amount in compensation if they claim that they did not get the refund money.

Because it's cheaper than an FOS claim.

Brie

Take the £75.  But state that you are taking it under protest as you do not consider your complaint to have been satisfactorily resolved if they refuse to investigate.  As to why £75 is offered as that's the amount the person at Tesco is authorised to give for complaints regarding X, Y or Z.  If it had been about A, B or C you would have been offered £25.  If it was about some absolute disaster it would have been escalated to Bob or Betty who have greater authority.

When the account was closed did everything, DDs, whatever, get transferred somewhere else?  I'd be checking with account in case Tescos have automatically batted the refund on to them.  

If there's no luck there then go to the ombudsperson.

Charliebonk

Brie said:

Take the £75.  But state that you are taking it under protest as you do not consider your complaint to have been satisfactorily resolved if they refuse to investigate.  As to why £75 is offered as that's the amount the person at Tesco is authorised to give for complaints regarding X, Y or Z.  If it had been about A, B or C you would have been offered £25.  If it was about some absolute disaster it would have been escalated to Bob or Betty who have greater authority.

When the account was closed did everything, DDs, whatever, get transferred somewhere else?  I'd be checking with account in case Tescos have automatically batted the refund on to them.  

If there's no luck there then go to the ombudsperson.

Hi Brie,
Does that means that I can take the £75 and still take this to the ombudsperson, or if I take the "compensation" that would be it?

This is what Tesco Bank wrote to me

"Regarding the £100.00 refund from PayPal. I can confirm that our Payment Operations Department have investigated the matter fully on three separate occasions and we've not received any funds whatsoever in relation to your closed PCA. They've not only checked for debit card refunds to the card you made the purchase with, but they've also checked for Faster Payments and BACS Payments to ensure we've done everything we can to locate the funds for you. Unfortunately, we are unable to investigate this further, and you would need to raise an investigation with PayPal to determine where they have sent the funds.

My Decision

Based on the poor service you received, I've upheld your complaint. To apologise, I'd like to compensate you £75.00. If you would like this to be transferred into your bank account, please respond to this email with the sort code & account number and I can arrange this."

Thanks for your help,

longjohnjohnson

Charliebonk said:

Brie said:

Take the £75.  But state that you are taking it under protest as you do not consider your complaint to have been satisfactorily resolved if they refuse to investigate.  As to why £75 is offered as that's the amount the person at Tesco is authorised to give for complaints regarding X, Y or Z.  If it had been about A, B or C you would have been offered £25.  If it was about some absolute disaster it would have been escalated to Bob or Betty who have greater authority.

When the account was closed did everything, DDs, whatever, get transferred somewhere else?  I'd be checking with account in case Tescos have automatically batted the refund on to them.  

If there's no luck there then go to the ombudsperson.

Hi Brie,
Does that means that I can take the £75 and still take this to the ombudsperson, or if I take the "compensation" that would be it?

This is what Tesco Bank wrote to me

"Regarding the £100.00 refund from PayPal. I can confirm that our Payment Operations Department have investigated the matter fully on three separate occasions and we've not received any funds whatsoever in relation to your closed PCA. They've not only checked for debit card refunds to the card you made the purchase with, but they've also checked for Faster Payments and BACS Payments to ensure we've done everything we can to locate the funds for you. Unfortunately, we are unable to investigate this further, and you would need to raise an investigation with PayPal to determine where they have sent the funds.

My Decision

Based on the poor service you received, I've upheld your complaint. To apologise, I'd like to compensate you £75.00. If you would like this to be transferred into your bank account, please respond to this email with the sort code & account number and I can arrange this."

Thanks for your help,

Your complaint was about poor service, so I'd argue that you won't be able to take a case of poor service to the Ombudsman if you accept the compo.

If you want the money back you really need to be taking this up with PayPal, but don't expect it to be easy.

Brie

Well i've seen cases where someone has accepted some compensation and still taken things further as it sometimes seems satisfying to stick the knife in.  Not saying that's what you want to do just that it happens sometimes.  

Is there anything in their answer that confirms that they were looking for the payment AFTER the account was closed?  If so can they confirm what would happen if the payment was sent to them when the account is no longer available?  Does it go into a holding account somewhere?  Or would it simply bounce immediately back to PayPal?

longjohnjohnson

Out of curiosity was the Tesco account closed or did you switch using the Current Account Switching service?

If it was the latter, I'm pretty sure the money would actually be diverted before hitting Tesco's systems (for bank transfers at least) which may be why they can't see the payment.

Charliebonk

Many thanks everyone for your help and assistance.  PayPal have gotten back to be quite quickly with a CC Transaction ID so I have passed this on to Tesco Bank for them to check out.  I'm not trying to be greedy here, if they find my refund they can keep their compensation but I suspect that they will not. We'll see what happens after that.

To answer a couple of questions here.

Yes, all of this happened after my account was closed.  PayPal says that if the account is closed when the refund happens then the money should bounce back to them after after 30 days (it has been longer and the money has not bounced back), but Tesco Bank claim that they never received the money in the first place, so nothing to bounce back.
As for my account, knowing that Tesco Bank was going to close their accounts in October/November I closed mine in August, it wasn't a switch, I did it all manually.

Spies

Tesco are talking rubbish. 

Incoming payments which don't have a valid open account go into a catch all account, this is the same for every bank.

They will need to trace the transaction in this account and then send you a cheque to recompense. 

born_again

Charliebonk said:

Many thanks everyone for your help and assistance.  PayPal have gotten back to be quite quickly with a CC Transaction ID so I have passed this on to Tesco Bank for them to check out.  I'm not trying to be greedy here, if they find my refund they can keep their compensation but I suspect that they will not. We'll see what happens after that.

To answer a couple of questions here.

Yes, all of this happened after my account was closed.  PayPal says that if the account is closed when the refund happens then the money should bounce back to them after after 30 days (it has been longer and the money has not bounced back), but Tesco Bank claim that they never received the money in the first place, so nothing to bounce back.
As for my account, knowing that Tesco Bank was going to close their accounts in October/November I closed mine in August, it wasn't a switch, I did it all manually.

Thought it was a debit card?

Just how did PP make the payment to Tesco?