| raymor |
04-26-2012 12:52 PM |
It's an AVS mismatch that the merchant mistook for a decline. It happens pretty often and it happens exactly as Sara described, being automatically refunded ten days later.
Quote:
Originally Posted by SwirlsGirl
(Post 18905938)
Well genius maybe not cover their *short* position with just my 20 bucks but what if the same thing happened to 1000 different transactions that day 1000 x 20 bucks = $20,000....then you might be able to temporarily cover a *short* position genius and thats more than logical
|
Yep, that would be twenty THOUSAND dollars if they did that a thousand times. A large bank has two BILLION dollars on hand on any given day.
Actually though, your thinking is it's a $20,000 loan. The federal funds rate is 0.15%, meaning for the bank to borrow $20,000 for ten days costs them $0.08. Yes, eight cents to borrow $20,000 from another bank.
let's look at that in figures:
Do commit fraud for:
8¢
when you have:
200,000,000,000¢
No, when the bank is a little short they just write a $10,000,000 check on their federal reserve account. Borrowing $10 million costs them $41.
You want to know what DID happen? An AVS mismatch, in all likelihood. Some merchants treat an AVS mismatch as a decline, but it's not. ePassporte used to do that. When the AVS doesn't match, the transaction will be flagged as such but it's still a perfectly valid transaction and the money is held out of your account. The merchant sees it's marked as mismatched AVS and THEY decided to ask you to check the address. (Or they didn't see it at all, just misplaced it.) Then when they neither complete the charge by marking it shipped nor refund it, ten days later the bank automatically refunds it. |
