Withdrawn dispute

We have a customer who disputed some cash app transactions. Turns out that his ex-wife, who was no longer on the account, but still knew the account information from when they were together (that's another topic), originated some cash app transactions out of the ex-husband's account without authorization.

Provisional credit was given, and during the "investigation" period when it was discovered who had originated the transactions, our customer contacted his ex-wife and she agreed to pay him back. The customer contacted us and withdrew the dispute since he was getting the money back.

When something like this happens, is it a problem to reverse the provisional credit and mail the customer a letter that the credits were reversed based on their withdrawal of the dispute? Or are we obligated to give the customer credit no matter what since the transactions were truly unauthorized?

The customer is not entitled to unjust enrichment. If they say they have settled the claim with the third party and are withdrawing the claim, I see no reason why you could not recoup the provisional credit. No difference than if a return showed up from the merchant.