The "Double Hold Banking Scam.
This is where a bank like Wachovia will change the date of your actual debit card purchase when they pay the charge to reflect a day or two after the actual date it was charged. This creates a temporary double hold on the available funds, which does not appear on the account but it reduces the available funds behind the scene not visible to the client. When the bank posts the payment (s), they change the initial charge date to the double hold date. However, the account summary still reflects a balance and date of when the initial hold was applied. Since the client only sees the initial hold on the account summary, they are not the wiser. If they are even wise enough to question why the charge date was change when it was paid by the bank, they are told because the merchant double billed. Yet, there is never a record of the double billing for that new date, and the account summary still displays a date and balance of the initial hold.
After the double hold is applied on a specific date after the initial charge date, any additional debit card charges or checks posted on that specific double hold date may take the account into overdraft and overdraft fees are applied. When the bank makes the payment, the double hold is removed and the initial charge date is changed on the posted payment (The new hold date is then recorded on the right hand side of the payment). However, the account summary will still display the initial charge date and balance to not awaken the client. The overdraft fees are applied for that specific double hold date and if the overdraft fees took the account into overdraft, the client is charged bank fees on the payment date. When a client calls the bank to inquire, they are told that when charges came in on the double hold date (new charge date), there was not enough available balance to pay the charge. Therefore, they were overdrawn and thus the overdraft fees.
The following example will demonstrate how the Double Hold Banking Scam can take a $100 bank balance and only $90 in charges and transfer it into a negative -$25 bank balance when the actual balance should be $10.
The Double Hold Bank Scam Example:
Starting Available Balance: $100
Charge#1 $60
Charge#2 $30
4/18/07 Initial hold of $60 - This is noted in the debit card hold section and the account summary reflects a
Posted Balance of $100 and an Available Balance of $40
4/18/07 Available balance $40
4/19/07 Double hold $60 - This is NOT noted anywhere on the client's account and the posted balance and
available balance remain the same. At this time, there is an actual hold behind the scene of $120 NOT $60.
4/19/07 Available balance $40
4/20/07 Initial hold $30 - The account is taken into overdraft yet this is NOT recorded on the account at this time. Nothing looks out of the ordinary.
4/20/07 Available balance $10
4/24/07 Posted payment $60 (4/19/07) The date of the initial charge is changed to 4/19/07; but the account summary still reflects an available balance of $40 on 4/18/07. If the client questions the changed charge date, they are told that the merchant double billed. Yet the account has no record of the double billing and the account summary still displays a date and balance of when the initial charge was applied ($40 on 4/18/07).
In addition, the debit card hold section is deleted and there is no available record.
4/24/07 Posted payment $30 The bank pays this and charges an overdraft fee of $35. If a client calls to inquire why they were charged an overdraft fee when they
had enough money to cover the charges, they are told that on 4/19/07 when the charge of $30 came in, they had charges that were on hold that reduced their available balance to a level that took them into overdraft.
4/24/07 Available balance (-$25)
* This is how the scam works to generate bank fees. This is a simple example. If you have some problem understanding it, add 10,20 or 30 transactions and the holds to it and see how complicated it gets to an average novice. It's ingenious and extremely hard to detect in the middle of multiple transactions.
Since the bank does remove the temporary double hold and makes a single payment on the charge, the books even out. No client is the wiser and it would be extremely difficult to detect by any novice.
You can test this out for yourself. Get anyone with a Wachovia Bank Account and watch their accounts. It's best to use an account with lots of movement. I suggest you take computer snap shots of the "debit card hold" section because they delete them. When the bank posts the payments, compare the dates of the debit card holds you took snaps shots of to the date the bank notes they were initially charged. What you will notice is that Wachovia is changing the initial charge dates when they pay the charge. If you study it more carefully, you will see that they are temporarily double holding to take the account into overdraft.
This bank scam reminds me of the old scam cashiers play on people even today. You would give them $20 for something you purchased. They would ring it up for $10 and put the $20 in the cash register. Then they would give you change on the $10. Later, during their shift or when they close the cash register out, they would pocket the extra $10. Since they only rung up a $10 sale on the cash register, the cash register ribbon that records the sale even out with the cash in the register (They keep a tally of the amount they took from people in their head or write it down somewhere. It can amount to hundreds of dollars per day). If a customer notices that they just got ripped off, the cashier or the store owner goes through the cash register's ribbon and looks at the charges. Since only $10 was entered, they can't see it from the ribbon. However, if the cashier did not pocket it yet and the cash in the register is checked with the ribbon, it is uncovered. The cashier apologizes for the mistake and there is no proof of intent and there is no possession. They are simply looked at as bad cashiers and they are free to do it again and again, etc.
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