-4

I'm guessing that both the source bank and the recipient bank have the ability to stop the transfer. Can the other entity, e.g. SWIFT, stop the transfer due to suspicion of fraud?

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    @RonJohn why would they do so if they aren't paid for it? Jan 4, 2021 at 6:33
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    @RonJohn why would they check for fraud? Feel free to insult me. Jan 4, 2021 at 6:47
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    @RonJohn you forgot intermediary/correspondent banks involved in Swift transfers by the way. I don't think you have much knowledge on how Swift works, just making guesses. Jan 4, 2021 at 7:06
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    To anyone who sends a lot of wire transfers, this is a perfectly normal Personal Finance question.
    – Fattie
    Jan 4, 2021 at 13:59
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    swift.com/our-solutions/compliance-and-shared-services/… may be relevant.
    – Freiheit
    Jan 4, 2021 at 14:36

1 Answer 1

-1

This is a fascinating question. We come to "why" at point 6 ...

  • wire transfers usually have the "from" bank, the "unto" bank, a "correspondent" bank, and (very rarely) more than one "correspondent" bank

  • it is indeed a fact that ANY of those three (or, rarely, more) banks can one way or another stop doing a wire transfer (due to suspected fraud, or whatever reason)

  • "SWIFT" itself is very confusing, it's just kind of an email system. (In theory, a "wire transfer" can be done with utterly no involvement of the SWIFT system - simply by all the banks involved phoning each other, or whatever communication system.)

  • the question of whether "the SWIFT organization" can stop a T is really interesting. Let us ask the question: "can the Police Department in Des Moines, Iowa stop a wire transfer?" The answer is simple: yes, it's dead easy. They just phone any of the banks mentioned in point two, and tell them "oh, please stop wire transfer XYZ". Note that I (wtf!) personally have stopped many wire transfers - simply by, to repeat, phoning one of the banks mentioned in point two. (I mean in the case of mistakes, errors etc.)

  • so in a sense, SURE, the SWIFT people can trivially stop a wire transfer: just as can any old (say) police department, or anyone with a telephone who phones the banks involved.

So the fascinating question is really this...

Is the SWIFT system (ie, the messaging system that banks {inevitably, but not necessarily} use to do wire transfers) a Pole for detecting suspicious or flagged transfers ... and then do they do anything about it?

For example, do cops (from Interpol, Des Moines, whatever) commonly call SWIFT and request that such and such wire be stopped? Or, do those cops just directly call one of the banks involved?

Unfortunately ....... I do not know.

But the key "mechanism" to understand is that all SWIFT would do, is, call the bank(s) involved and tell them to stop it (and/or reverse it, wires can be trivially reversed). SWIFT per se have no access whatsoever to banks database, SWIFT can't "reach in" and tap the button to undo a transaction. Similarly, cops (I assume!) can't "reach in" and tap a button to undo transactions - the cops would simply trivially phone the bank and say "oh please undo this this and this".

So again the sense of this question is:

in fact is SWIFT a pole, a nexus, for "keeping an eye on fraud wire transfers"?

For example, is there a person (or web interface) at SWIFT, which, is available for law enforcement worldwide to use to flag/search for certain wire transfers, where the SWIFT people immediately phone back the cops in question and let them know about the wire transfer (and then of course the cops could phone the bank(s) in question to have a transaction blocked)... ? Does SWIFT do that sort of thing? Unfortunately I do not know that.

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    This is a giant comment, not an answer.
    – RonJohn
    Jan 4, 2021 at 14:03

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