CHAPS payment failed to arrive

MarkC61

My father made a CHAPS payment from his Lloyds UK account to my Starling UK bank account on 24th August at 11:48. The CHAPS receipt from Lloyds states "payee name matches" and confirms the correct target sort code and target account number (both mine) were used.
Lloyds confirmed the money left his account before 15:00 and was now with Starling.
By early evening (24th) we were both onto our respective banks reporting that the money had failed to appear in my account.
3 days later (27th, and appalling customer service from Starling to boot) they have just requested that I obtain form MT103 from Lloyds. It is Saturday on a bank holiday weekend.
I am stupefied. Surely it is the responsibility of the banks to chase this, not the customer? I've never heard of an MT103 form before, but it appears to be to do with SWIFT rather than CHAPS payments. And is used in international transfers, not domestic as in this case.
Notwithstanding this, my main issue is that this was supposed to be in advance for a simple house completion next week and CHAPS is supposed to be secure and a guaranteed same-day facility (obviously providing the correct information has been provided.
With nothing coming from Starling despite repeated requests, I tried to make a complaint through The Financial Ombudsman. But they won't look at this for 8 weeks until the bank (which one - Lloyds or Starling?) issues a 'FINAL RESPONSE'. The purchase will have fallen through by then.
What actually are the guarantees with CHAPS if banks lose the customer's money? And what if they cause a house completion to fail even if they belatedly 'find' the money? Frankly I won't ever be using CHAPS again and certainly not unless I receive a full explanation of what happened.
Constructive advice would be most welcome - ie. nothing required about anti-money laundering etc etc. 

Keep_pedalling

The problem is probably to do with the fact that Starling are not direct participant of the system and  use third-party sponsors or intermediaries to process the CHAPS payments for them, which is almost certainly the reason for the delay. 

https://www.starlingbank.com/resources/banking/what-is-chaps-guide-to-chaps-payments/

MarkC61

Thanks @Keep_pedalling - I'd seen that list. But had assumed that, if it was an issue with a third-party, Starling would have volunteered that. I strongly suspect this will all get resolved after the bank holiday, but the lack of communication or reassurance is staggering.

MrFrugalFever

Hi, Not assistance as such but with NatWest a CHAPS payment can only be made via telephone banking or in-person via a branch. Generally only for transfers of £1m or more or where a Faster Payment service is unavailable. It is a same day service if made before 3pm on a business day. With this in mind, I would suggest it is Starling that needs to dig a bit deeper for you.
I’ve had an issue before whereby money was transferred to an account of mine by a business (shareholding) and then got rejected and returned, took over a month to resolve as neither parties would own up to where the money was.

I hope you get it resolved ASAP.

Daliah

Similar case here : https://forums.moneysavingexpert.com/discussion/5863300/missing-chaps-payment-not-able-to-complete

Your father needs to get Lloyds to put a trace on the payment but I think the likelihood is that there is an AML investigation underway and your money will appear when this is complete. CHAPS won't exempt you from AML checks - if it did, all money launderers would use CHAPS.

Daliah

Some CHAPS case studies from the FOS: https://www.financial-ombudsman.org.uk/files/2829/42.pdf

LillythePink

Don't know if this is still the case, but when we tried to send money to a Starling account from Lloyds, they blocked it and we had to go through security questions with them on the phone - this was under £5k for an upcoming holiday (spending money etc)

They didn't "approve" of Starling - this was Lloyds offshore though and in 2019.

We did get there in the end but it was a pain, so then had to take the long way round for future transfers ie Lloyds to HSBC, then HSBC to Starling (they had no problem with the payments at the time and still don't today).

Haven't tried to send money from Lloyds to Starling since.

MarkC61

Thanks @MrFrugalFever - it was initiated in person in a branch & well before 15:00 (11:30 according to the CHAPS receipt).

Thanks @Daliah - we obviously can't get any response now from Lloyds until after the bank holiday. Of course, of we'd known there was an issue in good time, we could have actioned that before the weekend. But we've only now been asked to obtain the MT103 form. Regarding AML checks, Starling had asked for information early on Thursday which I'd already provided (exchange of contracts notification etc from solicitor etc). Nothing further requested after the 24th. Thanks also for the case studies.

Thanks @LillythePink - interesting. I've done a number of similar & larger transactions both personally & with business accounts in UK & overseas. HSBC failed on 2 previous CHAPS for completion in the UK (solicitor to solicitor client accounts) & nearly caused the purchases to collapse.

I did have to do some circuitous transferring before, but that was pre-2010.

It's just a good job that I didn't leave all this to the last minute. But one would still like to have seen a sense of urgency or even reassurance. As far as the backs know, completion could have been yesterday (Friday).

Once again - thanks all & I'll post when & if success.

Ballard

One point which often brings confusion is the relationship between CHAPS & SWIFT. CHAPS is a way of sending Sterling between banks in the UK. Banks use SWIFT to transact CHAPS payment.

Swift MT103 messages are used to send any currency between any banks throughout the world (including domestically). This is subject to sanctions, obviously.

As the money hasn’t arrived it’s the remitter responsibility to get their bank to chase it. Starling may be able to help once they have all of the details (which they should get from the MT103£ but that’s not a given. 

Standingstrong

None of us on this fourm can help you. We can only give you advice ..

go to the branch and ask them what an earth is going on..

never heard of a CHAPS payment disappearing ?

what and why did starling ask for more infomation? Have you checked the online statement and see it’s credited ? 

xylophone

never heard of a CHAPS payment disappearing ?

I doubt that it has disappeared.

The MT 103 will show the route the funds took -  Lloyds/intermediary (CHAPS Direct participant)/ Starling.

But it may take Lloyds a day or two to provide the customer (OP's father) with the documentation and by that time the money may well have arrived in the OP's account.

With a transfer of  what may well be a very large sum from a private customer to private customer  (rather than solicitor's client account to solicitor's client account), an AML check may well be the reason for the delay?