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  1. #1

    I am so... I don't know what....

    Okay, just purchased server from.. well lets just say they are "global". Been with them for almost seven years I guess. Company always pro-rates so this time of month fee is somewhat small and that is good right now. Well two days later I check bank account and company has charged pro-rate fee as well as the whole amount thus sending my account into overages... Almost two hundred dollars in overdraft fees. Call company and they say that they charged it to see if it was there. And that it will not stick.

    Now bank and said company will not pay nor refund the overdrafts. My question is who should pay, bank or them? Just checked today and the big charge is no longer listed but overdraft fees are.

    Thanks for listening...

  2. #2
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    Unfortunately, You should pay. It is your account and therefore your responsibility. The company that charged your account is not responsible for making sure you have the funds in your account to cover those charges. That responsibility is yours. The bank has rules and published fee schedules for overdrafts getting the overdraft fees waived is pretty much impossible.

    In rare cases where the bank knows that you have automatic deposits, they will payout any checks or requests for funds from your account even if it has a zero balance. However, they will then add the overdraft fees to the negative balance and deduct it from your next deposit.
    Last edited by leeware; 05-24-2008 at 10:03 PM. Reason: corrections
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  3. #3
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    It's probably in their TOS or payment terms. You are the one liable unfortunately for not having enough funds in your bank account.
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  4. #4
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    Quote Originally Posted by vhead View Post
    My question is who should pay, bank or them?
    It depends on your agreement with this company.

  5. #5
    Quote Originally Posted by sinohosting View Post
    It's probably in their TOS or payment terms. You are the one liable unfortunately for not having enough funds in your bank account.
    I had enough funds in the account for the total given to me when I ordered which was $122, NOT almost $700. Nowhere did it tell me that it would be charging that much.

    Thanks!

  6. #6
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    I'm seeing this type of thing more and more and I think the rules need to change. Companies are putting a "hold" on funds temporarily, to make sure there is enough to cover the actual purchase. Gas stations are doing it, online companies are doing and...frankly, I don't think its right. It wouldn't be so bad if they would warn you ahead of time EXACTLY how much they will be holding.

    Case in point, I recently stopped to put $20 in my gas tank and paid for it at the pump with my debit card. I then went to the grocery store to pick up a few things and my card was declined. I was in shock, since I had just transferred over $100 into that account for my daily purchases. Guess what? The gas station put a $100 hold on my card without warning me!!!

    GRRRR!

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  7. #7
    I think you have to call the bank and specifically tell them to never approve any amount which isn't in the bank. Not exactly sure how it works, but by default they will do things one way, and you have to tell them to do it the other way.

    Boy that makes a lot of sense. Maybe someone else knows more about it. I just know we did it a couple years ago so they would reject the transaction if enough wasn't there instead of pay it and charge something like $30 to do it.

  8. #8
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    i have the same problem as AH-Tina, get gas for $40 on "credit' and get a $120 HOLD and a bonus $1 debit fee, even though i never entered a PIN and always choose credit.

    This is the new 'Sleezy Business 2.0'.

    Unfortunately, the banks will not refund overdraft fees easily, if not at all.

    It is 110% your fault for not knowing the amount of the mystery HOLD that will be placed on your money

    Only thing to do is goto the bank in person and as politely as possible explain the circumstances and ask them to refund the charges.

  9. #9
    Quote Originally Posted by AH-Tina View Post
    I'm seeing this type of thing more and more and I think the rules need to change. Companies are putting a "hold" on funds temporarily, to make sure there is enough to cover the actual purchase. Gas stations are doing it, online companies are doing and...frankly, I don't think its right. It wouldn't be so bad if they would warn you ahead of time EXACTLY how much they will be holding.

    Case in point, I recently stopped to put $20 in my gas tank and paid for it at the pump with my debit card. I then went to the grocery store to pick up a few things and my card was declined. I was in shock, since I had just transferred over $100 into that account for my daily purchases. Guess what? The gas station put a $100 hold on my card without warning me!!!

    GRRRR!

    --Tina
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  10. #10
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    Quote Originally Posted by vhead View Post
    Select pay by credit card and that will not happen.
    Yes it does. Gas satiations will pre-authorize your card for $70-100 even if the amount of gas is way less then those amounts. There was a news story on the local news about this a few months back. It had something to do with interest paid on the pre-authorization but I didn't catch the news story.


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  11. #11
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    is this the story: http://www.cbc.ca/canada/british-col...s.html?ref=rss

    Interesting comments too.

    I can not completely understand why a multi-billion dollar Credit Card, Bank and Fuel company can not process transactions in 'real-time'.

    A $10 webhost can do it !?!?!?!

    Oh wait, MONEY!

  12. #12
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    Quote Originally Posted by AH-Tina View Post
    Case in point, I recently stopped to put $20 in my gas tank and paid for it at the pump with my debit card. I then went to the grocery store to pick up a few things and my card was declined. I was in shock, since I had just transferred over $100 into that account for my daily purchases. Guess what? The gas station put a $100 hold on my card without warning me!!!

    GRRRR!

    --Tina
    I had a discussion about this with my mom the other day, when a similar thing happened to her when she paid at the pump. When she went to the bank to question why her card was declined at Walmart (after getting gas), the personal banker told her to not ever pay at the pump if she needed the funds to pay for something later. Apparently it's pretty standard practice for gas stations to put anywhere from a $50-$100 hold on funds when you pay at the pump. If you go inside and pay this is not (necessarily) the case.

    I can see it from both sides but don't agree with it. The gas stations - and probably *some* companies - probably got tired of too much fraud/phony cards/NSF issues and decided that holding a certain amount would cut down on those problems.

    However, most people I know don't have $50-$100 just lying around in their bank account for businesses to claim dibs on. They have bills that need to come out of each check and need that money available.

    vhead, if I'd been a customer somewhere for 7+ years and the company I was with suddenly decided to "check to make sure the funds were there", I'd certainly be talking to someone at the company about it, especially if no prior notice was given.
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  13. #13
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    I think P-nut brought one important information into light: vhead, you've been with them over seven years, are they only starting to follow this practice now?

  14. #14
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    Well, IMO, there is a biiiiiiiiig difference between $122 and $700.

    Personally, I would recommend filing complaints with the BBB and the state Attorney General's office ... even if you don't get your fees back, you are helping to establish a pattern of consumers who don't approve of this billing "practice."

    While an individual complaint may not be investigated by the state, you can bet that a business with a number of complaints against them, or a number of a specific type of complaints, will get noticed.

    That is, if the Texas Attorney General's office sees that a certain "global" provider is regularly putting very high "holds" on customer credit cards, that's bound to catch somebody's attention eventually ......

    Similarly if the Texas AG's office notices that consumers are complaining about credit card/debit card fund holds over x%, then maybe they will recommend a change in state law that would lower the maximum amount that could legally be held.

    In the end we are fighting the banking industry. They are the ones who have designed this system so we little people get pinged with insane fees for things that cost the bank nothing. (What's the difference if they refuse a transaction for NSF, or refuse a transaction for NSF and impose a fee? -- simple, $35 pure profit in fees for the bank. The cost of refusing the transaction is the same -- negligible -- whether the fee is imposed or not.)

    Of course the banking/financial industry has much deeper pockets, as well as effective lobbyists working all levels of government, working 'round the clock to ensure that our lawmakers don't screw up their sweet deal. Heaven forbid we little people should get a fair shake here ... the banks want none of that, because it means less $$$$$ for them.

    So until we can lessen the impact of lobbyists and get legislative changes pushed through, really our only (marginally effective) tool is complaint filing with the BBB, and any other agency that will accept our letters. At least the BBB will try to mitigate the situation. However the company does not have to respond to the BBB... it's not like the BBB is any sort of end-all, but they're better than nothing.

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  15. #15
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    maybe the 'people' need lobbyists already !

    if the 'people' each contributed 1/1000th of what big business contributes into the 'system' then 'we' can 'wine & dine' public officials too and get our way, or at least retire them with a hooker scandal if we dont.

    the problem is big business is 'squeezing' or 'stealing' from the little guy all the time to make up for their deficient financials.

  16. #16
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    Wow, this is quite a shocking story. The first I've ever heard of companies holding funds in a back account, that's quite scary that hosts can actually do that to ones money.

    I've never heard of petrol stations in the UK holding people's money like this, I guess it's something that hasn't come across the Atlantic yet.

  17. #17
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    I had a similar situation happen to me recently. First, I never use a debit card or setup any automatic withdrawals from my money accounts. This is specifically because I hold very high-balances and don't want any money leaving those accounts unless I physically draft a check agaist them. Secondly, I almost never carry cash because I like to have a record and a statement containing everything I spend money on. Finally, almost 95-100% of my spending flows through my credit-cards and escrow accounts. These things create a buffer (45 days) that allows me to monitor what gets charged and resolve any issues before I spend any real money i.e. (drafting a checks agaisnt my accounts. This system has served me well for over 15 years. In the past eight years or so I've needed a way to transfer money that I collect online into my money accounts so I setup a series of unlinked accounts and tied them to specific escrow accounts. To make a long story short (or a little bit longer,) I went into the bank one day and ask that the funds be transferred from one of these unlinked accounts and that the account be closed. On this particular day there was a trainee conducting these activies. Usually a bank manager handles my transactions for me, I figured it would be good practice for the trainee. The manager did his thing to allow the training to complete the transaction. It was a little rocky but (seemed) to have resulted in the desired outcome.

    About a week later, I buy a new cisco router and then another one. When I check my inventory I have three and I only need two. So, I cancel the order for one of them and ask that they credit my escrow account. The vendor does. A week later I receive a letter from the bank regarding NSF charges for $$$ for transactions posted against an account that should have been closed. So what happened? All of my vendors got paid from other accounts. However, the bank trainee transferred all of the money out of the account making it have a $0 balance but did not close the account. To avoid a ding on my otherwise perfect credit, I had to pay the NFS charges.
    As for the bank no doing what I clearly requested, they naturally shifted the responsibility to me -- saying that if the transaction receipt didn't show that the account was closed then it wasn't closed. Another example of "gotcha capitalism"
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  18. #18
    Quote Originally Posted by Evolver View Post
    Yes it does. Gas satiations will pre-authorize your card for $70-100 even if the amount of gas is way less then those amounts. There was a news story on the local news about this a few months back. It had something to do with interest paid on the pre-authorization but I didn't catch the news story.
    Not for me they don't. We had a tv news story that covered this and said to only pay via credit card at pump.

  19. #19
    Quote Originally Posted by dale View Post
    I think P-nut brought one important information into light: vhead, you've been with them over seven years, are they only starting to follow this practice now?
    Well it's been a while since I've purchased a server. Guess I had funds to cover it before and did not notice.

    So, everyone understands what I am saying... If they had said we WILL be temporarily charging you account for the amount of the pro-rate fee AND the WHOLE fee I would not have submitted order.

    I have talked to two people with this company and they could not care less!! This leaves a very bad taste in my mouth. I have never been one to use a company that does not care about me. My next server will NOT be with them. I will slowly migrate away from them as servers are upgraded. You would think seven years would mean something.

  20. #20
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    Quote Originally Posted by Coldkill View Post
    Wow, this is quite a shocking story. The first I've ever heard of companies holding funds in a back account, that's quite scary that hosts can actually do that to ones money.
    It's not the merchant. It's the bank. The bank holds the funds to cover the full authorization amount, and then they wait a certain period of time before letting the hold expire. The merchant only gets the amount that they actually end up charging, and has no control over the hold.

    Using a debit card online is risky business for many different reasons. It makes much more sense to use a real credit card, and just pay the balance off in full at the end of the month.
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  21. #21
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    Well, it's both the merchant and the bank.

    The merchant is doing something called an 'Authorization,' which puts a hold on the funds for 24-36 hours so the money is available if the merchant wants to come back and actually charge it through.

    By the same token, the bank is playing along and allowing the merchant to tie up a very large lump sum that the merchant never told the customer they were going to diddle with at the time of sale.



    Frankly, if it was me, I'd be freakin' irate. I don't use debit cards myself -- due to problems like this -- but either way, it's my money, and the merchant never received my permission to tie that space up on my card at that time. Every transaction has a dollar amount and a time stamp. If it doesn't match up exactly, I'm gonna be taking names and kicking some ***. End of story.



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  22. #22
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    Quote Originally Posted by vhead View Post
    Okay, just purchased server from.. well lets just say they are "global". Been with them for almost seven years I guess. Company always pro-rates so this time of month fee is somewhat small and that is good right now. Well two days later I check bank account and company has charged pro-rate fee as well as the whole amount thus sending my account into overages...
    Seems like they changed their pro-rata date or you miscalculated the date, when their billing calculates pro-rate + the next mth's amount.
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  23. #23
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    If that was the case Bob, then

    (a) the sign-up form would have properly calculated and stated the full amount that was actually put through on his card -- which it did not; and

    (b) the host would have charged the full amount through, not just put a temporary hold on it.

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  24. #24
    The $350 Taco

    One trip to Taco Bell was enough to send Joseph Rizk’s checking account into freefall.
    Rizk made the mistake of paying for fast food with his debit card. He figures he spent only about $5 more than he had in his account. Unfortunately, by the time he realized there was a problem, the bank had hit him about $350 in overdraft fees. At $25 to $35 per occurrence, it’s easy to rack up hundreds of dollars in needless NSF fees.
    "I overdrew, and they pretty much pummeled me with charges," said Rizk.
    The Center for Responsible Lending, a consumer group, estimates that overdraft charges cost people about $17.5 billion each year. The center’s research reveals that about 45 percent of those overdrafts are the result of using a debit card or taking out cash from the ATM.

    Banks used to refuse any debit card transaction that would overdraw a depositor’s account. But not any more. Banks could warn depositors when their accounts are close to being overdrawn. But they don’t.

    Instead most financial institutions automatically enroll their depositors in a program that loans them the amount of the overdraft—but at a steep price. The Center for Responsible Lending estimates that Banks that offer these lending programs can expect a sharp increase in overdraft revenues, as much as 200 to 400 percent.

    http://www.creditsecretsbible.org/ar...ADebitCard.htm

  25. #25
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    you can opt out of the overdraft situations. I've told my bank that if the money's not there, do not authorize! Period! They do this so they can rack up extra charges and make more money than they do by reloaning out my deposits. I refuse to let them make money on my back like this. I tell them if they can't disable the overdraft, then I'll take my business elsewhere. banks actually dislike average period who never bounce a check because they make no money off of them. they like big depositors or people who bounce checks because that's who they make their money off of.
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  26. #26
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    Quote Originally Posted by bithost(NET) View Post
    If that was the case Bob, then

    (a) the sign-up form would have properly calculated and stated the full amount that was actually put through on his card -- which it did not;
    It probably did and the OP missed it.
    (b) the host would have charged the full amount through, not just put a temporary hold on it.
    I didn't realise the host put a "temporary hold" on extra funds in the bank account. I doubt that was the case, and what we have here is someone not seeing the pro-rata + next mth's amount on the order form. We use pro-rate (pro-rata (sp?)) billing, and you'd be amazed at the number of folks complaining that they paid too much or too little, even though the order form clearly states what is pro-rate etc.
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  27. #27
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    I've had similar things happen and my bank (Wells Fargo) is tremendously good about making it right. I just stop by a branch the next day after I've paid the defect and the overdraft fee and ask politely for the fee ($34, I believe) to be removed, even if it was my fault for not keeping a balanced checkbook (though its usually the mis-charge or held funds scenario described here). I've had maybe 3 over the last 2 years and every one has been refunded in full; with a "thanks for being a customer" afterward.

  28. #28
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    Well vhead as others have stated, unfortunately, you are liable for the charges. I feel your pain though because this recently happened to me when I purchased a bunch of HDMI cables using my PayPal debit card. But for some reason unknown to me PayPal decided not to charge my PayPal balance but to attempt to charge my banks checking account directly. However my checking currently had only $5 since I use my PayPal debit card for purchases. I was charged $60 on overages on top of the $25 for the cables. I tried to contact PayPal however all they had to say was a apology for the confusion and state that they are not liable for any fees or charges my bank charges me.

  29. #29
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    Quote Originally Posted by taylorwilsdon View Post
    I've had similar things happen and my bank (Wells Fargo) is tremendously good about making it right. I just stop by a branch the next day after I've paid the defect and the overdraft fee and ask politely for the fee ($34, I believe) to be removed, even if it was my fault for not keeping a balanced checkbook (though its usually the mis-charge or held funds scenario described here). I've had maybe 3 over the last 2 years and every one has been refunded in full; with a "thanks for being a customer" afterward.
    Indeed. Wells Fargo is very good about removing overdraft fees. I've had a few incidents where they removed the fees after I explained the situation.

  30. #30
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    Quote Originally Posted by AH-Tina View Post
    Case in point, I recently stopped to put $20 in my gas tank and paid for it at the pump with my debit card. I then went to the grocery store to pick up a few things and my card was declined. I was in shock, since I had just transferred over $100 into that account for my daily purchases. Guess what? The gas station put a $100 hold on my card without warning me!!!

    GRRRR!

    --Tina
    ARE YOU KIDDING ME?!? It is just a basic requirement for gas stations to authorize your credit card before you purchase your gas. The $100 auth is based off a full tank SUV fillup. Obviously there is no way for the gas station to know how much your going to fill up on your card. So what if they authed $20 on your card, you had $25 balance on it, than you fill it up to $80, what are they suppose to do? If you are unhappy with this, than don't use a debit card at a gas station and pay cash instead. This way the gas station knows what your pumping BEFORE you pump.

    Your obviously not looking at the risk from the businesses view.

  31. #31
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    Sorry? Why would they auth an amount less then what you're paying? If I'm paying for $80 worth of petrol on my card, only $80 should be authorised, not $20??
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  32. #32
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    Welcome to the webhosting game. Charge first ask for forgiveness later. Every webhost is the same. And the ones that aren't are out of business very quickly.

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