Transfer app not working in Asterisk 1.4.17

I am attempting to do a SIP REFER using the Transfer command but instead of transferring the channel Asterisk just goes to the next priority in the dialplan. TRANSFERSTATUS is set to SUCCESS but the channel is not transferred.

exten => 408XXXXXXX,n,Transfer(SIP/1650XXXXXXX@X.X.X.X|j)

This worked in Asterisk 1.4.0 beta3 but not in the latest release.

Is there something I’m missing and/or is there another way to do a SIP REFER?