CHAPS Payment Lost

Ems12345

I was due to complete on a property purchase on Friday. As per all completions, the money is sent via the CHAPS process. 

My solicitor sent the money on Friday with a trace that says it left Barclays at 05.24am and arrived with Lloyds at 06.14am. At 11am there was no sign of the money in my sellers solicitors account. Time ticked on, still no sign of it. Lloyds seemingly just giving the repeated message to my sellers solicitor that ‘the money hadn’t arrived’. By 3.30pm Friday I think we’d all accepted it wasn’t happening, but would probably be there Monday. 

Monday came, still no sign. Pressure and chasing continued through the day on Lloyds to find the money. At this point they still said they couldn’t find it and were generally not being very helpful despite all of the signs pointing toward the money being at Lloyds somewhere (or someone at Lloyds knew where it was!).

Notice to complete was served down the chain. On Monday evening I took it upon myself to email the CEO of Lloyds Corporate Banking and whether by coincidence or my email worked, the money miraculously arrived with my sellers solicitor on the Tuesday around midday. No explanation of what actually happened, but at this point just relieved that the money have turned up.

I believe for the bank to actually ‘lose’ the money is very rare, but I wanted to share incase this could help someone in the future. My advice would be to escalate it to the top ASAP.  It’s terrifying that what is supposed to be a highly secure system can just lose track of hundreds of thousands of pounds. 

Has this ever happened to anyone else? Was there any rhyme or reason to it? 

Bonniepurple

It sounds as though it was unallocated rather than lost.  When a sum of money can’t be allocated to its rightful account (for example the name wasn’t exactly the same) the bank will put it to a suspense account to allow the transactions to balance.  Once they had confirmation that this sum was for X, it’s a simple process to move it out of suspense into the correct account.

I used to work in a banking team and transactions that went to suspense included ones where we hadn’t had an invoice through to allocate and ones where the amount was different to what was expected.  It’s not just the amount, it’s the accounting codes (Resource Accounting Code, cost centre, local project code etc etc) which all need to be right to allow the money to be posted to the right account.

MultiFuelBurner

Sounds like human error somewhere probably not at all the end banks fault.

fourmarks

I'm glad it all came together for you in the end but I can appreciate the stress it must have placed upon you, especially when it seems that the people who can solve the problem aren't particularly fussed or unduly concerned about it.  I've spent the last 2 days emptying 12 savings accounts and transferring the money to my main 'hub' account. It should have taken 1 day but two of the banks decided to play silly b's and stress me out, Tomorrow I go to the bank to make the CHAPS payment to my solicitors in time for completion on Monday. I've given myself plenty of wiggle room but I'll just be so relieved when it lands in the right place.

ProDave

When I set up a BACS payment to somone new (yes I know it is not the same thing) I send £1 to test that I have entered everything correctly and wait for confirmation it has arrived before sending the full amount.

It staggers me that a transaction of hundreds of thousands of pounds they don't do something similar and send £1 the day before to check everything is in order.

user1977

ProDave said:

When I set up a BACS payment to somone new (yes I know it is not the same thing) I send £1 to test that I have entered everything correctly and wait for confirmation it has arrived before sending the full amount.

It staggers me that a transaction of hundreds of thousands of pounds they don't do something similar and send £1 the day before to check everything is in order.

I've sent and received millions of pounds in my (professional!) time and have never encountered a scenario where monies went missing - or anybody suggesting that we double the admin by sending £1 test transfers. You check the numbers, check them twice, cross your fingers and hit send....(and generally, somebody else is going to check them again before it goes anywhere).

MultiFuelBurner

ProDave said:

When I set up a BACS payment to somone new (yes I know it is not the same thing) I send £1 to test that I have entered everything correctly and wait for confirmation it has arrived before sending the full amount.

It staggers me that a transaction of hundreds of thousands of pounds they don't do something similar and send £1 the day before to check everything is in order.

Agreed we always send a nominal sum first and so have others to us. Then you save the details from that first transaction and know it's good to go.

However the new system is better transfering money personally where they match up name and back accounts 

Jonboy_1984

Have seen a few similar “misplaced” chaps or international wires over the years at work(not property related or involving solicitors). One every occasion it was one of three things:

1) Mistyped payment reference number or name.
2) Wrong field used for an element of the data, so it cannot be automatically cleared and goes through a manual allocation at the receiving bank.
3) On hold for a fraud check of some description at one of the financial institutions involved.

Ems12345

Bonniepurple said:

It sounds as though it was unallocated rather than lost.  When a sum of money can’t be allocated to its rightful account (for example the name wasn’t exactly the same) the bank will put it to a suspense account to allow the transactions to balance.  Once they had confirmation that this sum was for X, it’s a simple process to move it out of suspense into the correct account.

I used to work in a banking team and transactions that went to suspense included ones where we hadn’t had an invoice through to allocate and ones where the amount was different to what was expected.  It’s not just the amount, it’s the accounting codes (Resource Accounting Code, cost centre, local project code etc etc) which all need to be right to allow the money to be posted to the right account.

Thank you - this is very useful insight! 

The trace showed it had arrived at Lloyds and they then couldn’t find it, so this could definitely tally up. 

That said we have also all (vendor, me, both solicitors and banks) seen screenshots of what was filled in to send it and nobody has raised any errors and I believe that the two solicitors also work with each other a lot and mine had sent a few different completion monies on the same day for different clients (none of the others had any issue). 

propertyrental

Only other issue that sometimes arises if the money is designated suspect i some way (scam, money laundering etc). Baks then freeze it without generally giving a reason while they investigate.