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Am I being stiffed? How would you react?
Thread poster: Eike Exner

Eike Exner
Japan
Local time: 17:05
Member (2016)
Japanese to English
+ ...
Apr 28

I did a job for a UK-based agency from Japanese to English for JPY 12,285 (yes, they pay in Yen; it's a branch office of a Japanese firm). My bank (in the U.S.) only received JPY 9,785 from them. A fee of USD 16 was deducted afterwards. UK bank charges were supposedly paid by the agency. I am emailing back and forth with my contact person at the agency and three times so far she has told me she had to "chase down" her finance team (which doesn't make sense to me, don't those people have chairs and desks?) and every time the finance team said what basically amounts to "must be translator's bank fees," despite the fact that I've repeatedly told them and sent them documents showing that my bank fee was deducted afterwards and doesn't even match the JPY 2,500 difference anyways...

Each time they also sent me a PDF of their payment instructions to the bank for JPY 12,285, but I noticed that it says in fine print at the bottom that the payment instructions are not proof of payment. I've asked the agency to show me actual proof of payment, which they've ignored. I have a hard time believing that an agency would go this far to cheat a translator out of a measly JPY 2,500 (which is about USD 22). The same agency wants to do a bigger project with me, but I'm hesitant due to this, which seems to me evidence of either gross incompetence or wrongdoing on their part... What would you advise in this situation?


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MollyRose  Identity Verified
United States
Local time: 03:05
Member (2010)
English to Spanish
+ ...
UK bank charges Apr 28

Does the pdf show where they instructed the bank to allow the agency to pay the UK bank charges (however they do it) instead of taking it out of the payment to you?

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Eike Exner
Japan
Local time: 17:05
Member (2016)
Japanese to English
+ ...
TOPIC STARTER
Yes, and the fee listed is less than JPY 2500 anyways. Apr 29

MollyRose wrote:

Does the pdf show where they instructed the bank to allow the agency to pay the UK bank charges (however they do it) instead of taking it out of the payment to you?


Yes. The PDF they sent me says "[their bank] charges paid by remitter" and their fee is listed as $15.16, which wouldn't even work out to JPY 2,500...


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Mikhail Kropotov  Identity Verified
Russian Federation
Local time: 11:05
Member (2005)
English to Russian
+ ...
In this situation I would advise Apr 29

to take only on very large projects for this agency, so that the fees are only a small %%,
or
to accept these losses as an equivalent of a lower effective per-word fee
or
never to work with them again


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Katalin Horváth McClure  Identity Verified
United States
Local time: 04:05
Member (2002)
English to Hungarian
+ ...
Intermediary bank charges Apr 29

Intermediary bank charges are charged by a THIRD bank that is between their bank and your bank. If their bank has no direct relationship with your bank, the transaction has to go through an intermediary,
Search the forums for this - it was discussed many times.

A few past threads:
http://www.proz.com/forum/money_matters/181460-bank_fees.html#1592617
http://www.proz.com/forum/money_matters/286477-bank_claims_charges_were_sha_client_proves_our.html



[Edited at 2017-04-29 03:05 GMT]


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Eike Exner
Japan
Local time: 17:05
Member (2016)
Japanese to English
+ ...
TOPIC STARTER
That was something I suspected, too, but it doesn't seem the case Apr 29

Katalin Horváth McClure wrote:

Intermediary bank charges are charged by a THIRD bank that is between their bank and your bank. If their bank has no direct relationship with your bank, the transaction has to go through an intermediary,
Search the forums for this - it was discussed many times.

A few past threads:
http://www.proz.com/forum/money_matters/181460-bank_fees.html#1592617
http://www.proz.com/forum/money_matters/286477-bank_claims_charges_were_sha_client_proves_our.html



[Edited at 2017-04-29 03:05 GMT]


I've considered this possibility because I've had that happen before. However, the wire transfer details from my bank only list the agency's bank, with no intermediary listed (As you point out in your response in one of the threads you linked to, "the wire transfer record should say which bank was involved"). And if this were the case, why wouldn't the agency simply have stated this? I can't be the first translator to have had this issue with them.

[Edited at 2017-04-29 04:08 GMT]


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Katalin Horváth McClure  Identity Verified
United States
Local time: 04:05
Member (2002)
English to Hungarian
+ ...
SWIFT code? Apr 29

Eike Exner wrote:

I've considered this possibility because I've had that happen before. However, the wire transfer details from my bank only list the agency's bank, with no intermediary listed (As you point out in your response in one of the threads you linked to, "the wire transfer record should say which bank was involved").


The statement you received from your bank may be an abbreviated one, not the full record. It may take some investigation on your (and your bank's) part to find out who the intermediary was.

And if this were the case, why wouldn't the agency simply have stated this?


Because they don't know. They pay the fees their bank imposes when they send the money, what happens after that is none of their business. As discussed in those past threads, when transferring the money internationally, using the SWIFT system, there is a SWIFT instruction code. If it is SHA (shared), then you are going to end up paying the intermediary charges. If the sender specifically requests the OUR code, then they would be paying for it, but I think the default setting is SHA, so that's what is being used in most cases.

I can't be the first translator to have had this issue with them.

But you may be the first one asking them about it.

The point is, this is one of those things that needs to be discussed and agreed upon in very clear terms with the client before accepting work from them. If they don't want or can't (for administrative reasons) pay for those intermediary charges, then adjust your fees to cover for it. Since it is usually a fixed amount, not a percentage of the total amount being wired, you could add it to each invoice as a "project setup fee" or something like that. I have had clients who agreed to this. They did not have to change their banking procedures just for me, and I got my money.


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Vadim Kadyrov  Identity Verified
Ukraine
Local time: 11:05
Member (2011)
English to Russian
+ ...
SWIFT payments Apr 29



[Edited at 2017-04-29 03:05 GMT] [/quote]
As you point out in your response in one of the threads you linked to, "the wire transfer record should say which bank was involved").

[Edited at 2017-04-29 04:08 GMT] [/quote]

This is a very specific info, and in order to get to the 'core" information about the route (with every "turn" and "corner") the funds have taken, you have to pay (yes, pay) for these specific details.


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Samuel Murray  Identity Verified
Netherlands
Local time: 10:05
Member (2006)
English to Afrikaans
+ ...
@Eike Apr 29

Eike Exner wrote:
I did a job for a UK-based agency from Japanese to English for JPY 12,285 [approx USD 100.15]. My bank (in the U.S.) only received JPY 9,785 [approx USD 80.36] from them. UK bank charges were supposedly paid by the agency. [Every] time the finance team said what basically amounts to "must be translator's bank fees," despite the fact that ... my bank fee was deducted afterwards.


Many people replying here about SWIFT transfers may say things like "it should be like this" but few have studied the SWIFT messaging format specifications to know whether or not it should really, really be like that. At best, anyone here can only tell you their own experiences, and some of them then assume that that must be the experience that everyone else has.

One example of a SWIFT transfer

I've had a look at just one example of a SWIFT payment that I had received myself last year. The agency's bank is a well-known bank in Dubai, and my bank in this example is the largest bank in South Africa. I regularly receive SWIFT transfers from this agency and the procedure is always roughly the same.

I'm not sure if there is an intermediary/correspondent bank. The agency's bank's payment advice mentions my bank's full details (incl. street address) as well as my name and my account number (with asterisks in a few places). My bank's SWIFT statement does not mention the agency's bank, but it does mention the agency's details (incl. their postal address).

In this example, the agency's accounting department processed the invoice on 13 June (no time given), their bank's payment advice is dated 15 June (no time given), my bank notified me of the inbound transfer at 8 AM on 15 June, I sent a reply e-mail to my bank two hours later that I "accept" the transfer, and the money was available in my account 6 hours later.

1. The invoiced amount was USD 3667 (amounts here rounded to nearest dollar)

2. The debit amount on agency's bank's payment notice is USD 3675. This is USD 8 more than the invoiced amount, but the payment notice also says "Handling fee from remitting bank: collect from remitter" (i.e. agency), so I assume this means the handling fee was USD 8.

3. The credit amount on my bank's SWIFT statement is USD 3642 (i.e. USD 33 less than previous amount). It also says ":71F:USD25,00" and "71F:USD15,00". These two figures seem to match subsequent events.

4. The amount released by my bank to me was USD 3627 (i.e. 15 less than previous amount).

5. The amount actually deposited into my bank account (in USD terms using the international exchange rate of the day) was USD 3596 (i.e. USD 31 less than previous amount -- but due to currency exchange fees and the fact that banks often use unfavourable exchange rates, I assume this is the USD 25 mentioned above).

6. After this, my bank also applied a transaction fee of approximately USD 19.

So in the end, the invoiced amount was USD 3667, the agency paid USD 3675, and I ended up with USD 3577, i.e. I myself paid approximately USD 90 in banking fees. And these fees are supposed to be independent of the amount transferred.

Each time they also sent me a PDF of their payment instructions ..., but I noticed that it says in fine print at the bottom that the payment instructions are not proof of payment. I've asked the agency to show me actual proof of payment...


Okay, firstly, that disclaimer is simply there for legal reasons. Secondly, what would you consider actual proof of payment? When I have made payment and that person asks for proof of payment, the only thing I can send them really is a screenshot of my internet banking page that shows the transfer out of my account, but I doubt if that would hold up in court. (-:


[Edited at 2017-04-29 09:01 GMT]


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Yasutomo Kanazawa  Identity Verified
Local time: 17:05
Member (2005)
English to Japanese
+ ...
Paypal Apr 29

Eike Exner wrote:

I did a job for a UK-based agency from Japanese to English for JPY 12,285 (yes, they pay in Yen; it's a branch office of a Japanese firm). My bank (in the U.S.) only received JPY 9,785 from them. A fee of USD 16 was deducted afterwards. UK bank charges were supposedly paid by the agency. I am emailing back and forth with my contact person at the agency and three times so far she has told me she had to "chase down" her finance team (which doesn't make sense to me, don't those people have chairs and desks?) and every time the finance team said what basically amounts to "must be translator's bank fees," despite the fact that I've repeatedly told them and sent them documents showing that my bank fee was deducted afterwards and doesn't even match the JPY 2,500 difference anyways...

Each time they also sent me a PDF of their payment instructions to the bank for JPY 12,285, but I noticed that it says in fine print at the bottom that the payment instructions are not proof of payment. I've asked the agency to show me actual proof of payment, which they've ignored. I have a hard time believing that an agency would go this far to cheat a translator out of a measly JPY 2,500 (which is about USD 22). The same agency wants to do a bigger project with me, but I'm hesitant due to this, which seems to me evidence of either gross incompetence or wrongdoing on their part... What would you advise in this situation?


I wonder why you didn't use Paypal instead of a bank transfer. Is it because you don't have a Paypal account, or your client simply doesn't use Paypal?
You could have avoided this trouble for such a small amount if you would have used one.


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Samuel Murray  Identity Verified
Netherlands
Local time: 10:05
Member (2006)
English to Afrikaans
+ ...
On finding the correspondent bank Apr 29

Katalin Horváth McClure wrote:
Eike Exner wrote:
However, the wire transfer details from my bank only list the agency's bank, with no intermediary listed (as you point out in your response in one of the threads you linked to, "the wire transfer record should say which bank was involved").

The statement you received from your bank may be an abbreviated one, not the full record. It may take some investigation on your (and your bank's) part to find out who the intermediary was.


It's very hard to get comprehensive information about this for free (the ISO standard used in SWIFT transfers is a paid publication), but sometimes one chances upon information on various banks' web sites.

AFAIK, in SWIFT terminology, the "intermediary" is called a "correspondent". There is such a thing as a "sender's correspondent" (code 53, e.g. ":53A:" if e.g. the option "A" is used) and a "recipient's correspondent" (code 54). Depending on which option is used along with the code, the SWIFT message may contain e.g. the correspondent institution's SWIFT/BIC code or their street address, but not necessarily. If the correspondent's account number is familiar to the sender's bank in other ways, the message may actually contain only the account number, plus a location.

Besides, even if you can discover who the intermediary bank is, you'd still have to contact that bank and convince it to share with you the transaction fee schedule that they use with other banks... and I doubt if that is information that banks would want to share.

When transferring the money internationally, using the SWIFT system, there is a SWIFT instruction code. If it is SHA (shared), then you are going to end up paying the intermediary charges. ... I think the default setting is SHA, so that's what is being used in most cases.


FWIW, it is mandatory for the SWIFT message to specify the code. The code for BEN/OUR/SHA on the SWIFT message is :71A:, by the way, so if one's bank's credit statement does not mention it, then it doesn't mean that they've used SHA -- it simply means that they don't copy that information from the SWIFT message into your credit statement.

That said, even if the code is OUR, you may still be stiffed with fees. From a report on SWIFT payment practices (lost the URL, sorry): "While the SWIFT User Handbook definitions for BEN/SHA/OUR charging codes remain constant, individual or some local practices have evolved substantially away from the legacy definitions" and "An increasing number of financial institutions are making the necessary system enhancements to support the use of SWIFT MT 103, field 71G to pre-pay charges for cross border payments, but use of field 71G without preliminary agreement with the receiving institution on the amount of charges due can result in over or under payment of charges and related inquiries and charge adjustments". So the system is far from perfect and predictable.


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Amel Abdullah  Identity Verified
Jordan
Arabic to English
+ ...
Frustratingly Common Apr 29

I doubt you are being "stiffed," which would mean that your client deliberately deducted money from your payment and did not tell you about it.

It's far more likely that these are intermediary bank charges, or that there is some charge for currency conversion that you are not aware of. These situations are frustrating but very common when transferring money to an overseas account (everyone wants their share of the pie, it seems) and usually have nothing to do with the entity making the payment.


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Nikki Scott-Despaigne  Identity Verified
Local time: 10:05
French to English
Another angle Apr 29

Bear in ind that termiology is important : fees, costs, charges are not necessarily the same thing. It is posible that your client is replying to your questions in a perfectly honest way. It is possible that they do not have control over everything that happens along the way.

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DZiW
Ukraine
English to Russian
+ ...
If they do have a local office or a representative Apr 29

Why not local transactions then?

Yes--it may be just a mistake or a greedy client, and (bridge)banks, as inflation agents, do persevere in cashing in on all customers, yet the client should have known about such a fleecing practice for I really doubt you're the first and the only their translator there. However, some things change without being noticed timely.

In all, if they are ready to cooperate on, they are sincere, satisfied and trust you; what about you?
Not before you make everything clear and tame that bad gut feeling.


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Heinrich Pesch  Identity Verified
Finland
Local time: 11:05
Member (2003)
Finnish to German
+ ...
Raise your rate accordingly Apr 30

And get Paypal account.

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