Transparency and International Funds Transfer

In June I attended the Ham Radio 2016 show in Friedricshafen, Germany.  I had the opportunity to purchase a nice, compact digital transceiver.  The Hytera PD365 cost surprisingly less than it would in the USA.  And, as a bonus, I could get the 19% Value Added Tax (VAT) refunded once I brought it home.

Sort of…

There are shops around the world that are setup to make the tax refund easy and will rebate it directly to your credit card.  Not so with Difona Communications GmbH, but they were able to provide a tax refund form at the show.  I had to get it stamped by customs upon leaving the European Union and then mail it back to the vendor in Germany.  They paid the refund via international wire transfer.

Here is where the fun began.  I received about $14 less than expected and set about trying to find out where the difference went.  It was not easy.  There is no transparency in such transactions.  I had to call my bank more than a handful of times before I could get to someone knowledgeable enough to assist.

Early calls revealed that the funds came in as US dollars via the Automated Clearing House (ACH).  The ACH received the funds from Fed Global.  What is Fed Global?  The Federal Reserve Bank.  The Fed suffers from a complete lack of transparency and will not speak to the consumer at all.  Kudos to those in Congress who want to audit the Fed.  I’m with you.

Anyway, after several weeks, numerous calls, and a case filed with the Consumer Financial Protection Bureau, I received an answer.

Fees were deducted from the amount that the vendor paid to me.  The vendor — Difona — indicated that this is what should be done at the time of the transfer.  Difona did not disclose this to me when I sent them an inquiry asking for documentation on the transaction.  Had this been disclosed, it would have saved me and others a lot of time spent on calls and emails to research the discrepancy.

Caveat emptor!

Hytera PD365 compact DMR radio
Hytera PD365 compact DMR radio
Still, I purchased a good piece of merchandise at less than 2/3 of the USA cost.  I learned that in the case of a VAT refund, it is better to deal with Global Blue particpating merchants.  Otherwise, expect to pay an undocumented and substantial fee for a wire transfer and expect no documentation or transparency.