If money gets lost in a domestic wire transfer

[bigliitlerock80]

What is the name of your state (only U.S. law)?

Both bank A and B are US based domestic banks, and wire transfer is domestic. I instructed bank A to initiate a direct trustee to trustee transfer from bank B where my IRA funds are being held. Bank B withdrew my IRA funds from my account with them one week ago. Bank A has not received it. I have to call bank B in the morning, but what are my options for finding my money? Does FDIC coverage come into play if the money is really lost? My IRA accounts at both bank A and B are FDIC insured. I realize bank B charges $30 for wire transfer which I did not know when I instructed bank A to initiate the transfer. I'm hoping this problem is because I did not pay B $30 for wire transfer, but if $30 wire transfer fee was the reason, they should not have withdrawn the money from my account. Any thoughts or similar experiences?

 

[FlyingRon]

You'll need to first contact both banks. More often than not a wire transfer goes awry because there's some piece of missing or incorrect information on the transfer. Believe me when doing the transfer I immediately contact both ends to make sure things work. I don't think the $30 fee has anything to do with it. At worst, bank A is going to come ask you to pay it.

FDIC won't help. They cover your deposit at a bank that fails, not your losses due to transactions.

 

[bigliitlerock80]

Bank A said they have not received it, and I need to get a trace # from Bank B. I wonder if this problem is due to not providing the medallion signature guarantee Bank A's rep said is needed, but if anything is missing why did they withdrew the money from my account? They should have let me know they need more info before withdrawing the money. Is it possible the bank will credit the money back to my account if I can't provide the missing info? If they don't, would it not be a theft by law? Or are they legally allowed to hold the money without the money being in my account? This is a large amount of money.

 

[FlyingRon]

It is not theft. Look we can't guess what's going on. This is a legal forum. You're going to have to talk to both banks. There is no amount of crying and footstamping that is going to get you anywhere until you talk to the parties involved. Chances are the money was transferred to the destination bank but because of some error (most likley on your part) it wasn't creditted to your account.

If your contact of the desitnation bank doesn't result in the money being found you need to escalate on both sides.
If that doesn't work try this:

 

[Chyvan]

I instructed bank A to initiate a direct trustee to trustee transfer from bank B where my IRA funds are being held.

I doubt very much that a WIRE was done. For there to be the remotest chance of a wire, you'd have had to start with Bank B where the actual funds were.

Bank B withdrew my IRA funds from my account with them one week ago.

The fact that it took a week for Bank B to remove the funds strongly suggests that Bank A mailed a form to Bank B with your signature on it, and is going to be mailing Bank A a check.

Bank A has not received it.

Has it been a week? That would be the amount of time that I'd allow because of how long it took for Bank B to do anything after you left Bank A.

I'm hoping this problem is because I did not pay B $30 for wire transfer, but if $30 wire transfer fee was the reason, they should not have withdrawn the money from my account.

I doubt it. If you didn't pay the fee, they'd just mail a check by default because it's so much cheaper. Besides that, with a form prepared by another bank, it's unlikely that Bank B would risk a wire under any circumstance. By sending a check, even if it were intercepted, Bank B would have presentment warranty protections so they could recover, make you whole, and not have to eat a loss.

I wonder if this problem is due to not providing the medallion signature guarantee

This raises some other doubts as to whether a wire was involved. Medallion Guarantees are usually reserved for when securities are in play like stocks, bonds, and mutual funds. I've never seen them used when it was just cash being moved.

Are you moving cash or are you moving shares intact so that there is no buy/sell and the corresponding broker fees?