Here's the scenario. You're a college student on a tight budget. You checked your account balance and saw that you have $500. You go shopping. You spend $40 on gas. Next stop, $20 on computer supplies. Third stop, $40 on groceries. Then you drive by Fred Meyer and see they have jewelry on sale. You decide you want to stop and buy a surprise for that hot chick who sits next to you in Diversity 101. You see a "can't miss" set of earrings for $350. You know you've got $400 left on the debit card, so you confidently hand the cashier the card. A minute later, the cashier informs you that the card has "insufficient funds", and a "loss prevention specialist" now wants to speak to you in private.
Maybe you misread your balance. Maybe another cashier at a previous stop mis-recorded a transaction. Or, maybe, the bank is playing "Russian roulette" with your money. Ever hear of the "sweeps"? In an essay posted on Jeff Rense's website, Ted Twietmeyer (pictured above left, courtesy of www.cvs.rochester.edu) tells us how this profit-squeezing trick by the banks causes consumer problems and even results in bad credit ratings.
Or...Little-known ways the banks rip you off every day
Everyone has done it. You stumble out of your car, make a bee-line for the card reader on the pump, swipe your card and the pump and start filling your tank. Why go inside and stand in line? This is far easier and it's all the same, right? I thought so too, until one day I found my bank balance was seriously shorter than it should be and explored the reason why.
Paying at the pump is NOT the same as paying inside. When you pay at the pump here's what happens. This fact is straight from a bank officer at my bank. Using your credit/debit card will authorize you to pump gas and the gas station company to invisibly debit your account for an amount that can be THREE TO FIVE TIMES what the pump displays! That's right - $20.00 of gasoline can result in an IMMEDIATE DEBIT from your account of up to $100.00.
Suppose you're driving on a long trip in a small to mid-size vehicle getting typical mileage and fill your tank twice the first day, by the time you reach your hotel or destination your bank account can be $200.00 less than when you got in your car that morning! And what if you drive a gas pig SUV that costs $40.00 to fill each time? Your bank account could plunge up to $400.00 without you being aware of it, before you even reach your hotel. If you're traveling on a tight budget, you could actually have your credit/debit card denied by the hotel when you check in. This too, was confirmed by the bank officer. Often when traveling by vehicle we think of the hotel as our single biggest daily expense. This isn't always the case.
The bank officer's remark about WHY this is done was, "They do that because they don't know how much gas you'll be buying." A lame excuse if I ever heard one. Any gas company could re-credit your account just as quickly as they debit it
It was time to test this fact prove it is indeed true. First, a look on-line to check my bank balance. Then a trip to the nearest gas station to fill the car. Immediately upon returning home I checked the bank balance again. Sure enough - a sum of 3 TIMES of what the pump display was gone from my account. And 3 1/2 days the missing money "re-appeared" in the bank. However, if you walk inside the gas station and pay there instead, my test revealed that only the exact amount is taken from the account. It's handled like any ordinary retail transaction.
Naturally, banks never tell account holders about this dirty deed - unless they ask about it or notice it. By now you're asking, "How long can they keep my money?" The answer I received upon asking the bank officer was THREE TO FIVE DAYS.
Now here's another aspect to this dirty deed few people realize. While your money has disappeared into this no-man's land - will you receive all the interest on it they made while it was stolen from you? Not likely.
There is also the absurd "5-7 day wait for deposited checks to clear." In this era of computers and instant credits and debits, does it REALLY take that long? Certainly not. But they use your money for several days in investment accounts, reap the interest and then give you nothing other than the actual deposit amount. But go try and write a check at any major store like China-mart and see what happens. The check reader attached to the cash register reads your account number, submits it to your bank through the network and immediately right there on the spot, takes the funds from your bank account. Checks are now the same as a debit card. One day in Wal-Mart a cashier called security because a woman had written a check which was rejected on-the-spot by the system. She was trying to buy a color television with it, and they took her away.
This one is right up there near the top of the nasty list of bank tricks. Like many people I pay my bills once a month. About 1AM I called the phone company to pay my phone bill. Quicker and more reliable than mailing it, right? It was shocking to discover that the transaction was DENIED by the phone company computer. Thinking I made an entry error, I tried a second time but to no avail. I then went on-line to check my bank balance and to my horror, found that all but about $20.00 was GONE from my account. That resulted in a sleepless night. Where did the money go? Was my account hacked? Did the bank make a serious error? What happened?
About 5AM, I crawled out of bed and to check on-line again. Presto- like a magic trick the missing funds re-appeared. But the bank had already hit my account with overdraw charges for EACH of the two attempts I made to pay my phone bill. Now I was boiling mad and couldn't wait until 9AM came.
If I was on the road and attempted to use that card at a gas station that night or at a hotel, it would have been denied.
A call to the bank resulted in numerous apologies by them for the stunt. Many readers already know what this is - it's called "sweeps." In the middle of the night many bank accounts are hit by this. Since the stock market is open on the other side of the planet, the bank's computers take the money from thousands of checking and other accounts and invest it in short-term investments overseas. Before the banks open, the money magically re-appears in all the accounts. Of course, the depositor never sees a penny in interest from this dirty trick either. You may have an "interest-bearing bank account" - but you'll never see the killing they make from your money overseas 5 days a week.
Now let's look at this system a bit closer: The entire sweeps system depends on EVERYTHING working flawlessly. Imagine for a moment that something goes wrong. Perhaps someone hacks the system (history shows that no system has ever been proven completely failsafe, and it is only as secure as those using it.)
What happens if the money ISN'T moved back into the accounts? Perhaps even your account? What then? A survey several years ago revealed that the average person has less than $20.00 of currency in their pocket in this age of plastic money. Imagine the calamity that would occur across the country, when every bank transaction is denied! Millions of people at stores, gas stations, restaurants, utility companies and more the next morning - all suddenly find the only money they have left is in their pocket. What then? Martial Law?
Think this can't ever happen in your country? Don't count on it. It just might be the way the economy will be destroyed overnight - all electronically. And those that do this dirty deed will remain invisible - hidden behind keyboards at a "secret location."
A frequent contributor to the Jeff Rense website, Ted Twietmeyer is an inventor, patent holder and engineer who has worked in defense and NASA projects for more than 20 years. He is somewhat of a conspiracy hound, so this must be taken into consideration. However, his suggestions in the essay above seem plausible.
This practice not only causes inconvenience to consumers, but clearly has national security implications. Profits before patriotism. Don't enslave yourselves to the credit economy. And, if possible, keep a one month's supply of cash on hand at all times.