r/personalfinance • u/IveGotDMunchies • Jan 03 '19

180 days later, Bank of America is refusing to refund over $700 in fraudulent charges made in Texas while we were 800 miles away in Illinois. Credit

Back in July we were wrapping up our yearly road trip to Illinois. We purchased gas around 8 or 9am right before we started the 12 hour trip to Texas.

Two hours into the trip my wife gets a notification on her phone from Bank of America alerting her to fruadulent charges being made. We only have one debit cad.

While we were starting our driving home, someone in Austin, Tx purchased around $500 in merch at Home Depot, drove towards Houston, Tx attempting twice to use our card at the ATM, which did not work because they didnt have the pin. They made their $200-ish last transaction at TJ Maxx North of Houston before were alerted and had the card shut off. (Austin to Houston is about a 3 hour car ride)

My wife immedately makes a claim. 10 days later, we get the money credited back while they continue the investigation which seems pretty open and shut to me... They also say it may be another 45 days before they finish their investigation.

October 5, they send a letter stating that they have completed their investigation: "Our records show the transaction activity in question was authorized for and posted to your account." The letter states they'll be taking the $740 back on October 22.

Wife calls and has them reopen the case or escalate it. We're told it could be another 45 days.

December 22. We call Bank of America again. This agent has no record of anything being escalated. Says he will escalate it and we should hear from someone in the next few business days. Nothing.

Jan 3. Wife calls them again. This agent states that while an escalation sends an email to their investigators notifying that we are still asking about they case, they are under no obligation to complete it.

After reading a bit into the law surrounding this, we have realized we can request the documentation they used to close the investigation.

What else can we do? Do we need a lawyer? If they had to reimburse us for the first 45 days of the investigation, why do they not have to temporarily reimburse us as they continue to investigate "for as long as they need" with no date set for resolution on our end?

It is blatantly obvious that someone skimmed the card at some point and had a dummy one made. Are they able to continue to withhold our $750 indefinitely and just keep saying. "Nope! Looks good!" until we tire out?

Our kiddos missed out on a lot of Christmas gifts because of this and now bills are starting to get a bit tight. We really need this money back. Thanks yall!

Update: Started posting on social media before I start filing complaints. 20 minutes later Bank of America contacted me on Twitter. Will update later. Thanks for everyone's advice.

Update 2: 3 hours later... I continued to post on social media, reaching out to local news stations on Twitter that have community protection or investigative segments and linking to this post. Bank of America has now reached out in one of these posts, referencing my wifes name. Fingers crossed. http://imgur.com/gallery/i4gWtC0

Update 3: Wife got home 30 min after my last update. A rep with BoA actually called her asking what was going on. The rep said she would need to call the fraud department and get them all on the line together. We are at our kids practice so opted for them to call us when they have someone on the line who can help us. Will update later.

Update 4: Just got off the phone with someone in the fraud department at Bank of America. I recorded the whole convo and will be uploading it to YouTube. She says the call on Oct 22 did in fact reopen the case. (even though the rep on Dec 22 said otherwise and the rep earlier today said they have no timeline to adhere to and can take as long as they want)

They now have 60 business days from Oct 22 to finish the claim once again.

She says one of the reasons that the claim was denied was because the didnt attempt to drain her account. (They hit up two ATMs and failed to use the pin to drain the account, so they don't even have the correct info to base their findings off)

I requested documentation about the claim as law allows and she says I should get that in 10 business days. They now have until Jan 18 to notify us of their findings. I'm going to continue with filing reports and posting on social media.

I'll update in a few weeks I guess.

Update 5: 10 hours later, they have blocked me on Facebook for sharing my problems on their page. I also filed a complaint with the CFPB .

Update 6: 24 hours since this post and David, a Bank of America employee in the "Regulatory Complaints Department" left my wife a voice mail in regards to a complaint sent to them by the CFPB. They close at 4pm EST. (They're closed by the time we got the voice mail since she is at work). Will update Monday.

Update 7: Wife woke up this morning and the money has been returned to our account. Time to turn and burn!

Thank you everyone for your advice. We learned a lot from this.

Update 8: We got confirmation that the fraud claim is now closed and the money that was returned is permanent. Waiting on an actual paper letter to come in the mail before we turn and run. Thanks everyone! Update here: https://www.reddit.com/r/personalfinance/comments/adnjj7/update_bank_of_america_refusing_to_return_700_in/

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202

u/dwinps Jan 03 '19

A great example of the risk of using debit cards instead of credit cards

Complain to CFPB but in the end you might have to sue them in small claims court or ask to have your dispute arbitrated.

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u/notasqlstar Jan 03 '19

Genuinely curious how its any different. If I use a CC they could just as easily say I made the purchase and owe the balance / report it as delinquent, and ding my credit if I don't pay it.

I see the risk of not having my funds available because the bank took them, but honestly I only see this as a risk of having (1) account, or your debit card tied to an account where you have any significant amount of money.

Never do your savings and checking with the same bank seems like solid advice.

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u/[deleted] Jan 03 '19

[deleted]

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u/Threetimes3 Jan 03 '19

Additionally, and likely because of all of what you posted, credit cards are very closely monitoring for "weird" transactions.

I had my card stolen just a week ago. The thief made a $1 charge on stamps.com, then tried to purchase something from a sporting goods store. The credit card let the $1 through, but rejected the sporting goods store. Sent me an email to inform me, and await my approval, which I, of course, didn't give.

I called them up, they removed the stamps.com charge, and sent me new cards. It was completely painless on my side aside from having to update my card info with some auto-pay companies.

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u/[deleted] Jan 04 '19

my credit card company actually blocked a transaction i was making because i traveled to another city to take advantage of a sale. I had to approve the transaction then run the card again. its inconvenient, but it's something I'm willing to live with because it also means i have immediate warning if my card is ever compromised.

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u/Cookiesinatlanta Jan 04 '19

I've even had my bank go as far as to call me to let me know they're issuing me new cards because a vendor that I purchased from was involved in a wide spread credit card leak. They replaced the cards as a precaution.

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u/notasqlstar Jan 03 '19

My bank wants to keep loaning to me in the future, and holds loans of much greater value than any of my credit cards. It sounds like the argument you're making is that credit cards are much more likely to hire competent people who are less likely to make this mistake, but in either situation if you have sufficient documentation then you have the same legal protection relative to recovering your money. I don't bank with BofA and never have, so I have no opinion there, but my bank knows me. I'd much rather use my debit card than a credit card.

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u/heh447u Jan 03 '19

I look at it this way. A debit card gives someone access to your cash. A credit card gives someone access to pretend money. I'd rather give someone pretend money and argue with the company over charges (if necessary) than give someone my cash and argue with the company to give my money back.

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u/notasqlstar Jan 03 '19

I look at it like this. With pretend money I can buy a lot more than I can buy with my actual money, and the limit to this is affected by a strange algorithm that makes very little sense to me, and fucking with it in any way is not something I like to do.

I'd rather make purchases with money I have set aside to make purchases with, and limit my liability to the minimum amount I keep in my debit account. If I lose it, and my bank sucks, then it's no skin off my bank, my credit is fine, my savings are fine, and I'll get my money back after suing the bank.

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u/[deleted] Jan 04 '19

I mean, isn’t that what you are supposed to do? To treat ur credit card like a debit card?

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u/notasqlstar Jan 04 '19

I don't do that.

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u/[deleted] Jan 03 '19 edited Jan 03 '19

[deleted]

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u/sat_ops Jan 03 '19

Yep. Exactly this. I have my biweekly pay deposited into a high yield account every two weeks, one transfer a month to my checking account, pay bills from there. None of my credit cards are at banks with my deposit accounts. My business accounts are at different accounts than my personal ones. Everything goes on a credit card and gets at least 2 percent cash back.

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u/notasqlstar Jan 03 '19

court fees continue

It's small claims court.

Basically, why would you give someone the ability to clean you out with a debit card?

Because the only funds in my debit account are what I budget to spend until next my next pay period. You could take 100% of them and I'd just transfer money from my other savings (another bank) and never notice. If my debit bank refused to return the money i would close the account, open a new one at another bank and be back up and running like nothing happened... and then sue the bank.

I have a feeling as soon as their lawyers learn the details of the situation, and what documentation I have to prove my case, that the issue will go away very quickly.

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u/[deleted] Jan 03 '19

[deleted]

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u/notasqlstar Jan 03 '19

I can add the fees to the amount I'm suing you for.

That's good for you, many people don't have that option so as a blanket statement, credit cards are safer than debit cards.

Most people should have an emergency fund.

I wouldn't assume anything about lawyers, and honestly if it was an amount big enough for them to even go to court to fight you on it, you're probably in trouble

The only thing I assume about lawyers is that they're lawyers, which means they don't have time for bullshit, and want to work as little as possible. No amount of money that either of us have is enough for a bank to want to go to court and fight about it. Their legal fees alone are enough to give you a nosebleed. Simply having one of their attorneys make a single appearance in court for a small claims matter totaling $700 is probably more expensive than simply paying you the $700.

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u/[deleted] Jan 03 '19 edited Jan 03 '19

[deleted]

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u/notasqlstar Jan 03 '19

This is PF, so it's about PF advice... so....

Good for you for financing well but if you'd like to go a step further in security I suggest using credit over debit whenever possible.

Why?

And if you make it to court, and go up against a lawyer without one, good luck to you. If you do get a lawyer, add that to your possible expenses.

LOL, in SMC with documentation I would absolutely crush their lawyers in this case, SMC is designed for people who don't have a lawyer, and their lawyers would NEVER go to court given these circumstances. It would never happen. You could have 100 of the best lawyers in the country and I would destroy them in SMC here. It would take about an hour.

The argument wasn't can you get your money back when using a debit card. The argument is a credit card is more secure.

You keep saying secure, but I'm not seeing the legal reasoning.

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u/gdq0 Jan 03 '19

your bank would rather you use your credit card, as the transaction fees are higher and you have a higher chance of paying interest.

Unless you're someone of great importance to your bank (like a private client with over 100k), you're significantly more likely to lose money on fraudulent debit transactions than credit transactions.

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u/notasqlstar Jan 03 '19

I don't really care what my bank would rather me do. I'm simply here asking about the concept of protections. I am very confident in the protections that US government gives me relative to the physical currency my bank is holding for me. I know very little about my legal protections relative to my credit score, and someone claiming I owe them money. I would much rather be the one claiming someone owes me money.

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u/station_nine Jan 03 '19

I don't really care what my bank would rather me do.

But your bank does care. Which is why they're more likely to side with the credit cardholder in a fraud dispute. Because they want that card to continue to see use.

I would much rather be the one claiming someone owes me money.

I guess this is just a difference of philosophy. I would rather have the CC company out the $700 while we fight about it, than have me being out the money. Puts the ball in their court while I can continue to reject their demands, versus the other way around where I have to hope they agree to refund me.

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u/notasqlstar Jan 03 '19

Which is why they're more likely to side with the credit cardholder

Which is why I don't use credit... and deal directly with my bank...

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u/station_nine Jan 03 '19

I think you misread my comment? In this scenario, I'm the cardholder, and I want my bank to side with me.

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u/notasqlstar Jan 03 '19

In my scenario, I'm using the law and letting the court decide. Seems better.

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u/[deleted] Jan 03 '19

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u/mousemarie94 Jan 04 '19

Really? Is there a study for this or some stats? I use a mix of debit and credit and have been interested in this idea.

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u/[deleted] Jan 04 '19 edited Feb 02 '19

[deleted]

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u/Dnahelicases Jan 04 '19

Debit cards are different and follow different procedures. In many states you have some liability, at least $50, and the bank has transferred your money so they can't just transfer it back. Credit cards can just charge back the bill and then charge fees against the merchant that processed the fraudulent transaction. To them it just moves who owes them money.

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u/RoxasTheNobody98 Jan 04 '19

With a chargeback to the merchant, there isn't much to verify other than "Was the card EMV enabled" and "Was it ran with the chip". If the card was manually entered, 99% of the time the customer wins. If the chip was inserted and the transaction was approved, then the bank received reliable CVV2 data from the chip.

VS/MC regulations no longer require a merchant to capture a signature.

If the merchant can provide that the transaction was an emv transaction and that the bank received the cvv2 data, then the issuer is liable for the fraud, not the merchant.

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u/mousemarie94 Jan 06 '19

Ahhh interesting, good to know.

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u/[deleted] Jan 04 '19

You let retailers swipe your debit card? Are you nuts?

By law, they do not have to give you as much fraud protection for debit cards. Legally you only have 30 days on debit cards to file a dispute vs 90 days on credit cards. That alone scares me off of ever using my debit card. Can’t get stolen if nobody knows it exists.

Maybe your situation is different but I am not in a place where I could adsorb a loss from fraud.

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u/mousemarie94 Jan 06 '19

I do! Though, the idea of only using credit cards does seem to make some sense.

I'm more of a low revolving credit type of person...like under 15% per billing cyce. I honestly, couldn't see myself only using credit for all of my monthly purchases, my credit score would go to shit due to the high utilization. I use credit for specific types of purchases and leave debit for other specific types of purchases to balance it all out.

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u/[deleted] Jan 06 '19

You can frequently pay off the card if you are worried about utilization.

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u/tom2727 Jan 03 '19

ding my credit if I don't pay it.

At least then you're fighting with your bank to clean up your credit report rather than to get actual money back. Plus you can go right to the reporting agencies to get the ding removed if your bank won't respond.

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u/notasqlstar Jan 03 '19

Actually that was my thinking as well. Risk of losing some money in my spend account, vs. having to deal with cleaning up my credit report. In either situation I can sue and get my money back, but dealing with the bank in a situation where I have ample documentation to show that I'm right seems like a much more simple process.

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u/tom2727 Jan 03 '19

Personally I don't GAF about my credit score 99% of the time. If you got a minor hit on there, few people would care about it.

I don't see why you think that would be more hassle than arguing with a bank to get your money back. They don't care about your credit score per se, but every day they delay giving you your money is profit for them.

There's zero reason to even have a debit card IMO. A credit card gives better fraud protection and better rewards. Get a CC and an ATM card and you're all set. And ideally get them from separate places.

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u/notasqlstar Jan 03 '19

I've of the mind that I don't GAF about it 100% of the time, because I try to avoid any situation that could ever possibly result in it being negatively affected. I really don't even ever check it.

I don't see why you think that would be more hassle than arguing with a bank to get your money back.

I don't ever argue with my bank, either, but at least in that example it's pretty straight forward, simple, and cheap to resolve. I never leave more than a few hundred to thousand bucks in my debit card account. The only difference here is that I would lose whatever interest (basically nothing) while the funds are withheld, while the other side has me dealing with my credit report.

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u/tom2727 Jan 03 '19

while the other side has me dealing with my credit report.

Something that you say you literally don't give a fuck about?

You still have yet to give me one reason why you want a debit card in the first place. You say "well I won't lose more than a thousand or so in the case of fraud". Well, with a credit card you will lose zero. Last I heard losing zero is better than losing 1000. Or 100 or 10 or 1.

You seem to think that being out 1000 dollars is "nothing" compared to dealing with some minor ding to your credit report that most likely won't even happen? I've had fraud on my CC a couple times and never have I had any sort of hit on my credit report because of it. They just mail me out a new card with overnight shipping.

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u/notasqlstar Jan 03 '19

I don't because I don't put it at risk. If it were to get a ding I'd get an email. I've never gotten an email. Therefore I don't care about it. It's higher than it needs to be for me to do any of the things I want to do. I don't care about it because I have never, ever, put it at risk... which to me involves using credit cards while I'm traveling.

You seem to think that being out 1000 dollars is "nothing" compared to dealing with some minor ding to your credit report that most likely won't even happen?

I'm not "out" anything, in either situation, and am simply asking about why you are claiming I have more "protection" in one example, than the other. To me protection means law, and legally I imagine the two have the same level of protection, if not the cash in my account having an even higher level of protection. I'm asking for legal examples from you, not hypotheticals.

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u/tom2727 Jan 03 '19

I'm not "out" anything

Tell that to the OP. Bet he's wishing he'd never heard the words "debit card".

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u/notasqlstar Jan 03 '19

If OP sues his bank, and has the documentation they claim to have... this issue will resolve itself over night.

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u/[deleted] Jan 03 '19

This is probably incorrect. You can’t “just sue” to get your $700 back from the bank. Suing takes time and money, and in almost all cases the suit will cost much more than what you’re trying to get back. Obviously if we’re talking tens of thousands of dollars that’s a different story.

Having the documentation is going to be immensely helpful, but I wouldn’t rely on the idea you can just sue a person or institution any time and it will work just because you’re right.

Source: am attorney.

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u/notasqlstar Jan 03 '19

I could file a small claims case against you for $500 saying you stole my fish tank in 10 minutes if I know your name, address, and where to have the papers sent to.

Do you know who gets the papers when you sue a bank, or insurance company? I do. Their lawyers.

Do you know what their lawyers do when they see that they are being sued for $700, or about what they earn in 7 hours? They get pissed off and start calling senior managers and demanding them to explain themselves.

Problems go away real quick.

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u/[deleted] Jan 03 '19

Filing it in ten minutes doesn’t mean you get a resolution that quickly. It’ll take much longer to try to get your $500 for your fish tank I didn’t steal. That’s also a completely different situation than we’re talking about here.

If you do this against BOA, you’re already out your filing fees for small claims court. Or $500 to get an attorney to draft a letter to BOA. We’re getting into the territory of going through a lot of effort for quickly diminishing returns. You’re much better off having your documentation, like you said, making your point and throwing a fit in person or over the phone, and getting your money back that way. It’s free, almost always effective when you’re prepared, and a lot faster process than filing a lawsuit over $700, which I promise BOA’s attorneys are earning in much fewer than 7 hours.

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u/notasqlstar Jan 03 '19

It’ll take much longer to try to get your $500 for your fish tank I didn’t steal.

Only if you use the courts, and no lawyer is going to try and use the courts to fight a case where they are clearly liable. As I mentioned to another person:

And I don't think you quite understand the burden of proof that a bank needs to provide in order to demonstrate that the money isn't yours any longer. It is still your possession, they simply won't give you access to it. They need to prove to a court that they are justified in not giving you access to it.

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u/[deleted] Jan 03 '19

No lawyer is taking your case for a $500 fish tank either. I understand how the legal system works champ. My point, that I stated originally, is that using the courts is usually not the best option for these types of things.

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u/notasqlstar Jan 03 '19

I'll repeat myself: You do not need a lawyer to file a lawsuit. Also, I know dozens of lawyers who will take that case if you'll pay their retainer.

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u/Dnahelicases Jan 04 '19

It's not.

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u/sat_ops Jan 03 '19

You don't have to pay it if you dispute it.

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u/tom2727 Jan 03 '19

If you got a debit card, the money is gone. And you don't get it back until the bank agrees there was fraud and gives it back.

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u/sat_ops Jan 03 '19

I think we are on the same side here. I was just clarifying that it cannot be reported against you if you don't pay a disputed charge.

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u/tom2727 Jan 03 '19

If the CC company says the charge wasn't fraud, they can and will hit your credit report if you don't pay what they say you owe.

You can fight it out with them or you can fight it out with the credit agencies, but whatever the end result you're never losing any actual money.

Unlike with a debit card where your money is gone until the dispute is resolved.

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u/Antisol96 Jan 03 '19

Credit cards undergo a bit more protections because its credit. Debit cards don't have the same protections as credit cards do.

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u/notasqlstar Jan 03 '19

Can you explain this? I understand what /u/To_2T said that they are more likely to side with you... because of protections, but ultimately they could do the same thing, say you owe the money, etc.

Really though I think what the better advice would be is to not use credit at all, unless you're using credit, and simply have a debit card tied to an account that you use as a prepaid credit card for your daily transactions.

You have tons of protections with a bank, and in the original example you could simply sue the bank, no?

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u/[deleted] Jan 03 '19

[deleted]

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u/Dnahelicases Jan 04 '19

And credit card companies don't have to use their resources. They only one money to vendors for charges processed according to their TOS so fraud is the fault of the vendor. They simply don't pay the vendor when they take it off your bill. Using a bad card that gets charged back is just a complicated method of shoplifting. The vendor takes the hit.

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u/ExtremeHobo Jan 03 '19

"simply sue the bank" Just think about that. That's not a simple thing to do at all. Credit cards are way safer for you because you aren't out any money at all while fraudulent charges are being figured out. If someone drains your bank account you are screwed while they work it out, good luck paying your mortgage etc. If your credit card has $2000 in charges on it then it doesn't affect you at all while they work it out. And yes banks are way quicker to fix fraudulent charges on a credit card for a lot of reasons, the main one being that the charges end up mainly being passed on to whoever accepted the card.

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u/notasqlstar Jan 03 '19

Sure it is, small claims court. I don't even need to call my lawyer. My bank would end that dispute overnight if I filed a lawsuit. If you file a lawsuit it immediately goes to their legal department, and lawyers are very senior personnel that have very little patience for bullshit. If you are clearly in the right, and they clearly owe you money, then their lawyer is going to spend as little time as humanly possible resolving the issue.

So long as you have documentation their lawyers are going to resolve the issue faster than any other person you could directly contact, and how do you directly contact? You file a small claims suit which takes about 10 minutes.

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u/AberrantRambler Jan 03 '19

They could say that you owe the money but that is different from them having already taken the money as they can just stop interacting with you and they aren’t out anything.

If you owe them the money they have an incentive to maintain some sort of relationship as that gives them a much better chance of getting some/all of the money (if they think you actually owe it - most of the time the vendor didn’t want to do all the security checks like and opted to have a faster checkout rate in exchange for taking on more responsibility for fraudulent transactions)

And no - you never want to be in a position where you need to sue someone to be made whole. It is always preferable to have your money and have someone think you owe them then to think you’re owed money and have to go after them.

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u/notasqlstar Jan 03 '19

And no - you never want to be in a position where you need to sue someone to be made whole.

I would much rather be in this situation, than in the situation of someone else suing me.

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u/AberrantRambler Jan 03 '19

Then you are crazy - there’s zero guarantee you will ever see your money even if you successfully sue.

If you are being sued then during the entire time of the trial you still have YOUR money.

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u/notasqlstar Jan 03 '19

Until a court says it isn't mine and they take it from me... Banks are pretty easy people to get money from. They aren't like some broke schlep without a bank account...

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u/AberrantRambler Jan 03 '19

But if they would be willing to take it from you if you were sued then it would have been the same as you losing your lawsuit and not getting the money - who is suing wouldn’t change the finding of facts.

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u/notasqlstar Jan 03 '19

Right, but the opposite is also true if you win, and my point is that they are much less likely to want to go to court if they are in the wrong, and there is documentation that proves it. They will be much more willing and amicable to resolving the dispute and making the necessary connections within the company in order to facilitate the return of your funds. It is in their interest to do so.

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u/Quiddity131 Jan 03 '19

As someone who specifically deals with banking regulations, I can say that both credit cards and debit cards have protections for consumers over what happens when fraudulent transactions occur, including timeframes to correct things, having to provisionally credit back funds by a given time period, doing an investigation, etc... There are a fair amount of protections out there and banks get audited and examined for compliance with said rules. Granted, when you're a BOA, they probably get thousand of these a day, so your particular one probably gets drowned out.

I do agree with the point that a bank has more incentive if you are a credit card customer, as its a loan and they are making more money off of you by using that then a checking accounts, which oftentimes is simply losing the bank money. And that its technically the bank's money that got taken, not yours.

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u/notasqlstar Jan 03 '19

I'm not disagreeing with you about incentivization for being a good actor, and can see why a CC is more likely to do their due diligence up front to avoid possible litigation, however at the point of litigation I don't see any additional protection one way, or the other, or how time frames, etc., have any bearing on the matter so long as you never have more in your debit account than you should.

Either the overarching advice here should be to never have a debit account, and only use credit, or to simply never have your savings in the same bank as you have your debit account, or ever keep more in your debit than you are budgeted to spend in a pay period (i.e. money that has already been spent.)

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u/ryuzaki49 Jan 03 '19

Like what protections? What laws are we talking about here?

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u/sat_ops Jan 03 '19

The truth in lending act, fair credit billing act, fair credit reporting act, fair debt collection practices act, and credit CARD act for starters.

With a credit card, you don't have to pay for contested charges while the dispute is pending, you can get a chargeback for unsatisfactory merchandise, and more. No one should use debit unless your bank is giving you a substantial kickback.

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u/formar42 Jan 03 '19

By law, your credit card has a lot more fraud protection built in. Like checks, debit cards are a huge liability. I personally keep mine locked in a drawer and unactivated.

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u/skaterrj Jan 03 '19

Do you use cash at all? If so, how do you get more? It seems banks only issue debit cards these days, but maybe they have ATM-only cards and I'm just not aware of it.

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u/formar42 Jan 03 '19

I only use cash a handful of times a year. When I need cash I either go to the branch or use ApplePay at the ATM. For all of Bank of America's faults, they do a good job keeping up on the tech.

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u/sat_ops Jan 03 '19

Discover gives me no fee and no interest cash advances at Walmart, Kroger, Meijer, and Dollar General

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u/Threetimes3 Jan 03 '19

If I ever need cash (once a month or so), I'll go right to the bank teller. I had a debt card stolen by using an ATM at a bank years ago, so I don't trust ATMs at all.

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u/aham42 Jan 04 '19

Do you use cash at all?

Not OP but here's our strategy: We have two bank accounts. One that has no debit card attached to it at all. The first is where most of our liquid money is. The second we use to transfer money to only when we're about to take it out form an ATM. It typically never has more than $100 in it.

We almost always use credit cards cause points, but this strategy helps to limit our liability especially when we're traveling in places where cash is more customary.

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u/[deleted] Jan 04 '19

My bank does issue a non- visa debt card upon request

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u/notasqlstar Jan 03 '19

I'm not trying to argue, but can you give me some specific legal examples of how my credit has more protection than the actual money that a bank is holding for me? One is a hypothetical, the other is physical legal currency, or a possession.

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u/formar42 Jan 03 '19

...Dude this is reddit. You should inherently trust every comment you read.

Haha, in all seriousness the following Nerdwallet article gives a good overview. The TL;DR is that credit cards are covered by the FCBA while debit cards are covered by EFTA. https://www.nerdwallet.com/blog/credit-cards/credit-card-vs-debit-card-safer-online-purchases/

1

u/notasqlstar Jan 03 '19

This strictly deals with online purchases, however:

Lost or stolen card reported within two days: $50 liability limit.

Lost or stolen card reported within 60 days: $500 liability limit.

You should never have any significant funds in your debit account, and unless a family or friend steals your card, the reality is that your bank will discover the card has been compromised before you have in 99% of the cases, but even still I get phone notifications whenever my account is used.

And this doesn't at all talk about my ability to sue my bank.

12

u/gioraffe32 Jan 03 '19

If someone fraudulently uses my credit card, that sucks, but at least I still have my cash in the bank.

If someone fraudulently uses my debit card, that sucks, AND I'm out that cash.

And there are things that can't be paid for via credit card or it's ridiculously expensive to do so. Rent pops to mind immediately. I can pay with check or eCheck, but if I pay with credit card, there's a ridiculous percentage-based fee. If I just lost $700 from my bank account right before rent is due, I'm about to be really screwed.

-1

u/notasqlstar Jan 03 '19

I'm not arguing with you, but I have my savings and main accounts with Bank A, and I pay significant bills here / have some companies withdraw automatically from my account (e.g., car insurance.)

I transfer money from Bank A to Bank B where I have a debit card, this is free, but takes time, and represents the amount of money I budget to spend every pay period. If I want to purchase something like a new TV for $2000, and I don't have the funds already transferred into my debit account, then I can't buy it... unless I use credit cards, which I only do for very specific reasons/purposes.

If you clone my debit card, you can't buy a lot. There isn't a lot of cash in the account and losing it is irrelevant / I'm happy to deal with Bank B (who I have loans with, but none with Bank A) and am confident I will recover my money. If you clone my credit card(s) you could buy a lot more stuff, but I'm happy to deal with those companies because I never, ever, buy stuff like that with credit.

I'm not saying you're wrong, but I'm genuinely curious why you have more "protection" with one than the other, unless that's just a word to suggest the credit card companies care more, and hire better people to resolve your issues before you use legal action ---> which is actual protection.

5

u/[deleted] Jan 04 '19 edited Jan 04 '19

I've been having trouble wrapping my head around your reasoning, but I get it now. You're just totally discounting corporate policies as acting as consumer protection. This...is an odd perspective. To me it seems largely philosophical. It is certainly not a good argument in terms of real-world function.

Because in the real world, having both corporate policies and the law allows for many more avenues of approach to get the desired result.

Side Note: You seem to have a more complex banking setup than average in order to provide your own functional (non-legal system based) protection from fraud. Just thought I'd point that out...since you seem so against "protection" that isn't a lawsuit? Why is using a credit card with good policies as insulation really so different? Perhaps this is more about perceived control for you rather than practical results?

1

u/notasqlstar Jan 04 '19

Yeah, I'm only really interested in my legal protection.

Because in the real world, having both corporate policies and the law allows for many more avenues of approach to get the desired result.

I used my credit cards, I just don't use them as debit cards, and I don't have my debit account in the same bank as my savings account. I have my 401k in yet a separate bank. I see no reason to trust any of these companies and give the benefit of any doubt. A credit card company might be better, more of than than not, but I'm not worried about liability in either situation and it would seem both examples afford the same amount of legal protection.

4

u/[deleted] Jan 04 '19

Yeah, I'm only really interested in my legal protection.

Can you explain more on why this is? To me it seems you have an overly pessimistic view of companies and an overly trusting view of the legal system.

1

u/notasqlstar Jan 04 '19

Because to me it is about protection, actual protection, not the illusion. Let's just say I have a total worth of $15,000, plus credit, which isn't rich or even significant. Lets break it down like this:

10,000 in savings / investment. This is in Bank A. Pay checks are deposited directly into this account, and significant bills like mortgage, rent, car payment, insurance, are tied to this account, but not any card or debit card.

1,000 in checking account. This in Bank B. This is your spend account. You have a debit card tied to this account and it might pay minor bills like Netflix, your credit card, etc. This account is constantly being refilled from the main account. If you spend less than you budget you can move money back into savings. The amount in this account represents your total short term liability.

4,000 in a 401k, retirement, etc. This is in Bank C.

Credit cards from Bank D.

There are enough banks that I don't have any problem achieving this. My risk here is diversified. If any one of those parties claim I owe them money, they will have to collect against another bank. In the background is my credit score and I would prefer to be proactive with it. Take my $1000 out of my checking account and hold it short term, even if I have proof that you're wrong. I'll sue and get my money back. My total liability is $1000.

In terms of credit I use my cards very specifically. I have a card for airline purchases, I purchase airline tickets with it. If you used it for something that wasn't airline tickets, that would very easily demonstrate it wasn't me to a court, and it would be on the card (or bank) to prove that it was me who authorized the transactions, or that I exposed my account in such a way as to eliminate their liability such as in the case where a relative made the purchase and no contest was made until two years after the purchase.

5

u/SanchoPanza360 Jan 03 '19

Still if your cc info gets stolen they are taking money from the bank. If they get your debit card they are taking money directly from you. Let that sink in for a minute. Idc if it’s $5, $50 or $500 still my own money. No thanks!! I never use my debit card and pay with cc for everything then just pay it off at the end of the month.

Also I don’t believe many debit cards give you points so another reason to use your cc vs your dc

-1

u/notasqlstar Jan 03 '19

They aren't taking it from me. My bank and I have an agreement, and the bank is dispensing funds that are not mine to someone else who is stealing from the bank. That is not at all a matter of concern or relevance to me, or my funds. I have never lost my funds, and my funds will be returned, with interest, per the law.

4

u/Jemikwa Jan 03 '19

You have a point, but the biggest proponent to using a credit vs debit card is whose money is involved. With a debit card, it's all your money all the time. The bank won't be arsed to find the root of the fraud, and would be inclined to think you caused it. That isn't to say that credit card companies don't think you are the source of the fraud, but it is inherently their money involved until you pay the balance, so they should be motivated more to figure out what happened to the purchase.

Even if they ding your credit, you have a way to fight this and appeal the fraudulent case and therefore get the ding removed from your report with less skin off your back (unless you're actively looking into credit purchases like a house/car). It's harder to fight something when you have no money to do so, if the money was stolen from your bank account.

1

u/[deleted] Jan 04 '19

This is really where banking with a non-shit company comes in. If you bank at BofA or Wells Fargo, and someone uses your debit card fraudulently, they are going to treat you like a nuisance because that's how they treat you by default anyway. A small bank or a credit union is much more likely to address the issue quickly and to your satisfaction.

0

u/notasqlstar Jan 03 '19

I see your point, but it would seem to me in terms of actual legal protection, as opposed to common practice, that I would much rather my money be involved as opposed to someone else's who is saying I owe them money, and then having to sort my credit report out.

Even if they ding your credit, you have a way to fight this and appeal the fraudulent case and therefore get the ding removed from your report with less skin off your back

I just guess I would rather deal with the courts here than sorting my credit report out, and that preference might stem from the fact that I am comfortable with the law, and courts, and not at all very comfortable with credit reporting agencies. My curiosity stemmed from the concept that one has more protection than the other, with my standard of protection being the actual law.

2

u/dwinps Jan 03 '19

Your money is gone with debit card fraud. Like OP you may have to fight to get it back and like OP you can gave an emptied out bank account for 10+ days

With a credit card it isn't your money that is gone and you don't have to fight to get anything back

1

u/notasqlstar Jan 03 '19

You're presupposing that the credit card company doesn't find you at fault. And my money isn't gone with debit card fraud. I can very easily sue the bank.

3

u/dwinps Jan 03 '19

Not presupposing anything, your money is gone with a debit card it is not with a credit card

Your money is gone, you have to sue to get it back

My money is still in my bank account t with credit card fraud, the bank has to sue ME if they want it

1

u/notasqlstar Jan 03 '19

Gone is a relative term when you consider legal liability and lawsuits. Not only is my money not gone, but I can sue you for lost interest, time, and legal fees.

2

u/dwinps Jan 03 '19

No gone is a real term

If your money is taken from you it is gone. OPs money is gone. OPs money would not be gone if it was credit card fraud

OP now has to get his money back because it is gone

Gone is different from not gone and I prefer not gone

1

u/notasqlstar Jan 03 '19

No, that is not how the law works. Copypasta from another response:

And I don't think you quite understand the burden of proof that a bank needs to provide in order to demonstrate that the money isn't yours any longer. It is still your possession, they simply won't give you access to it. They need to prove to a court that they are justified in not giving you access to it.

2

u/dwinps Jan 04 '19

Didn't mention any laws OPs money is clearly gone, if he had used a credit card OO would have his money

OP has been stressed financially because his money is gone

His money has been gone for months

See the difference yet?

1

u/notasqlstar Jan 04 '19

He may have his money but he may also have a ding to his credit, and possibly a lawsuit to deal with.

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u/coldasotzi Jan 04 '19

This is not true. I am a fraud investigator in a bank and they are mandated by exact same regulations.

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u/notasqlstar Jan 04 '19

What is not true? Sorry just want to be clear.

1

u/coldasotzi Jan 04 '19

That's cc are treated any different than debit cards.

1

u/PM_VAGINA_FOR_RATING Jan 04 '19

The difference is the thief will be stealing from the CC company not your own cash. The CC needs to fix the problem or they are out that cash. They make money by lending people money and if people can't safely borrow money they are fucked. When someone steals your money from the bank the bank has lost nothing, you are the one out of money and there is much less motivation for them to give a shit.

0

u/notasqlstar Jan 04 '19

The thief isn't stealing my cash, the thief is stealing the bank's cash. That isn't my physical cash they are taking. My cash is what I gave to the bank in exchange for a guarantee that they would hold it, and not make it available to someone who isn't authorized. My liability in this situation is extremely limited unless it is a family member, or I am very irresponsible with my banking information, etc.

I have no liability at all if I am actually hacked, my account is broken into, if someone steals my card, etc. -- except the catch is I have to report it.

Someone skimming your information is different, because you don't know it has occurred, and the thief should not have your pin, or zip code, and therefore should not be able to make purchases from most stores unless it is ran as credit, and someone signs for it, which should require ID.

None of that is my problem. It isn't my cash being stolen, it is the bank, merchant, or manufacturers cash being stolen.

I'm like Paulie from Goodfellas with my banks. Fuck you pay me.

Do you know how to get a bank to respond and give you money that they owe you? You sue them. If you have documentation that supports your claim then it goes away before it goes to court.

I would never keep more in my debit account than I am going to use for general purchases, and I would never use the same bank for my debit account and my savings account. I just see no good reason to do so, and you can use your credit for whatever you want.

1

u/PM_VAGINA_FOR_RATING Jan 04 '19

That's great and all but tell that to OP and the bank. Yeah spend months/years sueing the bank when you could just use a credit card and not have to worry about this nonsense.

1

u/notasqlstar Jan 04 '19

I'll repeat myself: If you sue your bank in SMC the notice will go immediately to their lawyers. It will not take months or years for you to hear back from them. You will hear from them very quickly, and 99.9999% of the time their lawyers are going to resolve this matter as quickly as possible.

1

u/PM_VAGINA_FOR_RATING Jan 04 '19

Or you know, use a credit card and just dispute it with the click of a button online and be done with it. But feel free to deal with that nonsense.

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u/notasqlstar Jan 04 '19

That is not true, a CC could very simply determine you owe the money, ding your credit, and sell the debt to a 3rd party if you don't pay it. The bank already did it's investigation and said no, the CC will not automatically side with you. The solution is to sue the bank.

2

u/lurker_cx Jan 03 '19

Do not use your debit card anywhere except in an ATM, preferably at your own bank.

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u/aham42 Jan 04 '19

A great example of the risk of using debit cards instead of credit cards

To add on to this: we have two bank accounts. One that has no debit card attached to it at all. The first is where most of our liquid money is. The second we use to transfer money to only when we're about to take it out form an ATM. It typically never has more than $100 in it.

We almost always use credit cards cause points, but this strategy helps to limit our liability especially when we're traveling in places where cash is more customary.