Obama's credit card declined

[Channel72]

http://www.nbcnews.com/politics/barack- ... yc-n228251

Hilarious. It's so like a Democrat to spend irresponsibly like that.

But seriously, this happens to me all the time. I'm getting so sick of credit cards being declined for bullshit reasons. I understand these security algorithms are in place for a good reason, but they're seriously inconvenient. Human "spending patterns" have too many edge cases and are too hard to predict. Plus, it's pretty embarrassing when you're standing on line somewhere or at a restaurant and your card is declined.

And if you ever leave the state/country or whatever, forget it. It's guaranteed your card will be deactivated. You always have to remember to call the card company beforehand, which is really annoying.

The practical effect of this is that a credit card is basically unreliable. This means you need one or more backup cards, which further complicates your life or you just have to carry cash everywhere.

[Gaidin]

I think I like my bank's method better. Call and confirm last five transactions.

[Arthur_Tuxedo]

Also, the banks like to tell us it's for our protection, but that's bullshit. We are not liable for fraudulent charges as card holders (provided they are reported as such within 48 hours). These measures protect the bank at our expense and then the smarmy bastards tell us it's for our own good like Nurse Ratchet. So glad I don't work for banks anymore!

[Crossroads Inc.]

Ok, to play devils advocate for a moment...

I spent 3+ years working at one of the big banks, and i'll say that first off, yes, a banks computer systems seem as though they will decline any out of the ordinary purchase at the drop of a hat these days... But I really got to say, there is a reason for it!

Channel, not to anger too much, but I dealt with people like you almost every day who complain about "always have to remember to call the card company beforehand, which is really annoying."

Well, guess what.. If you want to go with a "Big Bank" there are certain things you just have to deal with... Big Banks are BIG, they are targets of hackers, as well as people trying to sue them (usually for good reason) every other day or so...

So many people these days are obsessed with "convenience" in their bank... They want an ATM of their bank EVERYWHERE, every city, every state, everywhere... Well.. If you want these things, you have to put up with the fact that Big Banks have to be paranoid about ANY little transaction out of the ordinary...

When I worked for a 'Big' bank, and still banked with one.. At one point I actually had THREE debit cards...
One I used ONLY for Internet shopping.
One I used ONLY for out of state shopping.
And then one I used for normal day to day stuff...

For the most part, unless i was buying something REALLY expensive, I never had any card lock problems. And the few times I Did have , it was easy to take care of.

These days.. These days I am with a credit union. I have one card, and so far have NEVER had a single situation of the card being declined...

So, if you want the ups of a Big Bank, learn to deal with card locking.. If not, learn to deal with a smaller bank...

[Ziggy Stardust]

Yeah, I've never had a problem with this. The few times my card has been declined have been perfectly reasonable situations for the bank/credit company to be suspicious; for example, when I moved to North Carolina and bought a new big-screen TV soon thereafter. It took all of ten seconds to resolve over the phone, and it's a common enough situation that it doesn't particularly inconvenience anyone.

As for traveling, again, it's about a ten second process to give the bank a heads up. I've never had a problem when traveling after telling them, and the one time I forgot to do so, it was only about ten seconds to call and clear it up.

How on earth is this a massive inconvenience for anyone?

[Jub]

I've never had an issue with card locking, but I've always been with one of Canada's national banks and I created a new account with ANZ when I was in Australia for six months. I also don't tend to travel that much or make big lump sum purchases off of my card.

[Lord Revan]

I wonder if the president has a single account/bank he HAS to use during his time in the office, I'm not an american so I wouldn't know and quite frankly I'm also not intrested enough to try to find out, but it could explain why he wouldn't have spare card avaible wouldn't it

[Ziggy Stardust]

It is worth noting that the same thing also happened to President Clinton during his time in office.

I wonder if the president has a single account/bank he HAS to use during his time in the office, I'm not an american so I wouldn't know and quite frankly I'm also not intrested enough to try to find out, but it could explain why he wouldn't have spare card avaible wouldn't it

I'm no expert on the subject. But George Bush Sr. used an American Express, while Obama has been seen using a J.P. Morgan credit card, according to this BBC article. The basic impression that I get is that, well, it doesn't even matter, because the president pretty much never has to pay for anything anyway.

[Eternal_Freedom]

Can't say I've ever had a problem with this. Then again, I only have debit cards and the UK banks seem reasonably competent. The one time I've had a slight issue is when ordering stuff from overseas, in which case they call up and ask you to verify the last few transactions and all is merry.

Of course, since then I use Paypal for online stuff as it's easier.

[Elheru Aran]

IIRC, Presidents aren't forbidden from paying for stuff on their own dime, they just generally don't have to because almost all of their expenses tend to be accounted for on the budget for the Office of the President (or whatever pays for their stuff). I imagine the case is something along the lines of Obama simply hadn't used that card for a while and his bank was all 'what is going on'.

[Channel72]

Ok, to play devils advocate for a moment...

I spent 3+ years working at one of the big banks, and i'll say that first off, yes, a banks computer systems seem as though they will decline any out of the ordinary purchase at the drop of a hat these days... But I really got to say, there is a reason for it!

Channel, not to anger too much, but I dealt with people like you almost every day who complain about "always have to remember to call the card company beforehand, which is really annoying."

Well, guess what.. If you want to go with a "Big Bank" there are certain things you just have to deal with... Big Banks are BIG, they are targets of hackers, as well as people trying to sue them (usually for good reason) every other day or so...

So many people these days are obsessed with "convenience" in their bank... They want an ATM of their bank EVERYWHERE, every city, every state, everywhere... Well.. If you want these things, you have to put up with the fact that Big Banks have to be paranoid about ANY little transaction out of the ordinary...

When I worked for a 'Big' bank, and still banked with one.. At one point I actually had THREE debit cards...
One I used ONLY for Internet shopping.
One I used ONLY for out of state shopping.
And then one I used for normal day to day stuff...

For the most part, unless i was buying something REALLY expensive, I never had any card lock problems. And the few times I Did have , it was easy to take care of.

These days.. These days I am with a credit union. I have one card, and so far have NEVER had a single situation of the card being declined...

So, if you want the ups of a Big Bank, learn to deal with card locking.. If not, learn to deal with a smaller bank...

Yeah I use a pretty big bank (Chase) so I can see your point.

Still, it's a real nuisance - the system is so trigger happy with deactivating your account on the slightest deviance in behavior. Can't they just call you first? I mean, has anyone actually calculated how much banks would lose if they just absorbed the occasional actual instance of fraud instead of immediately locking the account? A large bank like Chase or HSBC should be able to absorb the losses a lot better than some small local bank anyway. Plus, what you're talking about seems to apply mostly to debit cards. Even if you have a small local bank, a thief can still use your credit card anywhere - I mean ultimately it's going to be VISA/Mastercard compatible regardless of the bank that issued it.

I've had my card deactivated like, I don't know, maybe a dozen times in the past - and only once was it an actual instance of fraud. The thing is, the one time it actually was fraud, the circumstances were so obvious that any bank would have shut off the card. (Basically, I had traveled to San Francisco, and while I was there someone charged my card at an electronics store in Brooklyn - meaning they actually had a physical card with them which I guess they must have copied my card's data to somehow. Anyway, since the bank knew I couldn't move 3,000 miles in a few minutes, it was an obvious case of fraud.) But every other time was pointless. They wouldn't call me or anything - I'd just be out somewhere and my card would stop working. Very irritating.

I understand your point about big banks, but I wonder how much money the banks would actually lose if they decreased the convenience/security ratio a bit in favor of convenience.

[Crossroads Inc.]

For banks, it isn;t about loosing money, it's about IMAGE.

Do you seriously think a "Big Bank" would one day go "Let decrease our security protocols so Customers don't complain as much.. Sure there m ay be thousands of more fraud cases, but they are small, we won't loose that much money!"

Would you, or others REALLY goto a bank that said "We have lower security protocols so your not as annoyed with us!"

Also... Again having worked in a Big bank for three years... I can tell you there is no such thing as an 'obvious' case of fraud.
I once had a guy who had given his credit card to his girlfriend, so she could use it on a trip to Europe. We saw the guys debit card being used in the states, and his credit card being used a thousand miles awhile... but it was perfectly legit...

Also.. Do you know how much time it takes to call someone for a "short" 2 or 3 min call? Imagine having to do that thousands of times per day for a bank.. That would either massively sap the amount of calls a bank could handle coming in.. Or they would need to create a whole new department JUST for calling people to say "Is this a real transaction?"

[Gaidin]

Also.. Do you know how much time it takes to call someone for a "short" 2 or 3 min call? Imagine having to do that thousands of times per day for a bank.. That would either massively sap the amount of calls a bank could handle coming in.. Or they would need to create a whole new department JUST for calling people to say "Is this a real transaction?"

If my bank does that with an auto-voice 'press 1 for yes press 2 for no' are you telling me your big bank can't?

[Starglider]

This is mostly due to the USA being so lazy and backward about adopting chip + PIN. Cardholder-present fraud is much harder with these cards, so banks can use uses significantly less aggressive anti-fraud algorithms. For some reason the US has a fetish for near-worthless (single dollar) notes, physical cheques and magnetic stripe cards that have been utterly trivial to clone since the early 90s or so.

[Gandalf]

This is mostly due to the USA being so lazy and backward about adopting chip + PIN. Cardholder-present fraud is much harder with these cards, so banks can use uses significantly less aggressive anti-fraud algorithms. For some reason the US has a fetish for near-worthless (single dollar) notes, physical cheques and magnetic stripe cards that have been utterly trivial to clone since the early 90s or so.

With the exception of rare person to person transfers where cash would be impractical, I don't think I've seen a physical cheque since the early nineties.

[fgalkin]

This is mostly due to the USA being so lazy and backward about adopting chip + PIN. Cardholder-present fraud is much harder with these cards, so banks can use uses significantly less aggressive anti-fraud algorithms. For some reason the US has a fetish for near-worthless (single dollar) notes, physical cheques and magnetic stripe cards that have been utterly trivial to clone since the early 90s or so.

Yeah right, because chip+pin is so much more secure. Not. Banks are pushing for the technology not because they want to minimize fraud, but because of the transfer of liability to the consumer that accompanies the switch. Someone broke in and maxed out your credit card? That's too bad, enjoy proving you weren't negligent, or you're on the hook for the whole amount.

Have a very nice day.
-fgalkin

[Alyeska]

Slow credit card verification lands Florida Man in jail

Bank deliberately slows down credit card verification. Business calls police. Police arrest the guy for credit card fraud. The guy is totally innocent because it is his card and the bank was deliberately slowing down the verification.

[Jub]

Yeah right, because chip+pin is so much more secure. Not. Banks are pushing for the technology not because they want to minimize fraud, but because of the transfer of liability to the consumer that accompanies the switch. Someone broke in and maxed out your credit card? That's too bad, enjoy proving you weren't negligent, or you're on the hook for the whole amount.

Have a very nice day.
-fgalkin

In Canada and Australia tap to pay pinless transactions are becoming more common than insert chip pin protected transactions and our banks are doing the opposite of what you say they should be doing. They're saying that they are willing to incur more risk so we can have faster transaction times. This is one of the great things about having large national scale banks that can take hits that would fell a region operation.

[Channel72]

It's also important to note that aside from the inconvenience, a declined credit card can have actual negative social effects. Suppose you're taking a business client out to dinner or something, and your stupid card gets declined. That's pretty fucking embarrassing, and can lead to the loss of a client. (Because humans are just that petty...). Or you're out on a first date? Hope the credit card gods have favor on you and your card actually works... otherwise you come off like a delinquent who can't responsibly manage your finances.

Anyway, what's wrong with something like the following algorithm:

Code: Select all

if amount of suspicious charge <= median spending amount: 
   call the customer
   if customer doesn't respond within X hours: deactivate card
else if amount of suspicious charge > median spending amount:
   call the customer
   if customer doesn't respond immediately: deactivate card

The phone calls can even be done by a computer, so the bank doesn't need to hire an army of phone operators.

But instead, lots of banks will just deactivate the card without even informing the customer.

[phongn]

Also, the banks like to tell us it's for our protection, but that's bullshit. We are not liable for fraudulent charges as card holders (provided they are reported as such within 48 hours). These measures protect the bank at our expense and then the smarmy bastards tell us it's for our own good like Nurse Ratchet. So glad I don't work for banks anymore!

Someone maxes out your credit card. You try to buy groceries for the week (or some medication, or any number of important things) and your card is declined. That's annoying at the least. Or your debit card number is stolen, and your bank account is (temporarily) emptied. That can be seriously bad. This is for your own protection, as well as theirs.

It's also important to note that aside from the inconvenience, a declined credit card can have actual negative social effects. Suppose you're taking a business client out to dinner or something, and your stupid card gets declined. That's pretty fucking embarrassing, and can lead to the loss of a client. (Because humans are just that petty...). Or you're out on a first date? Hope the credit card gods have favor on you and your card actually works... otherwise you come off like a delinquent who can't responsibly manage your finances.

American Express typically will not decline restaurant transactions for that reason, especially on their charge (not credit) cards.

This is mostly due to the USA being so lazy and backward about adopting chip + PIN. Cardholder-present fraud is much harder with these cards, so banks can use uses significantly less aggressive anti-fraud algorithms. For some reason the US has a fetish for near-worthless (single dollar) notes, physical cheques and magnetic stripe cards that have been utterly trivial to clone since the early 90s or so.

Early adopter issues, though physical checks have almost entirely been replaced by ACH transactions and magnetic strip phaseout begins next year.

Yeah right, because chip+pin is so much more secure. Not. Banks are pushing for the technology not because they want to minimize fraud, but because of the transfer of liability to the consumer that accompanies the switch. Someone broke in and maxed out your credit card? That's too bad, enjoy proving you weren't negligent, or you're on the hook for the whole amount.

EMV is immensely more secure than magnetic stripe cards, which have zero security other than bank-side statistical analysis. While Chip+PIN is not as resilient to attack as hoped for, it would've trivially prevented most of the large-scale retail compromises in the USA. There's also more advanced implementations like Google Wallet and Apple Pay.

The issue with transfer of liability is totally separated from whether we should move from magnetic stripe. It just so happens that in Europe they did transfer liability; that doesn't necessarily have to happen in the USA.

[Starglider]

[Yeah right, because chip+pin is so much more secure. Not.

You didn't even read your own link, you just googled and spammed the first thing that met your preconception. Chip+PIN, like any security system cost effective enough for mass deployment, has never been completely secure. It started very good and is still 'good', versus mag stripe which started at 'bad' and is now 'laughable'. This is not a matter of personal opinion, international banks use the same card processing infrastructure globally and the anti-fraud algorithm aggressiveness is carefully set to a trade off of fraud costs vs customer frustration & lost trade. All banks set the triggers much lower in the US because the fraud figures* are so much higher.

* Cardholder present fraud, cardholder not present is a different issue.

[Arthur_Tuxedo]

Also, the banks like to tell us it's for our protection, but that's bullshit. We are not liable for fraudulent charges as card holders (provided they are reported as such within 48 hours). These measures protect the bank at our expense and then the smarmy bastards tell us it's for our own good like Nurse Ratchet. So glad I don't work for banks anymore!

Someone maxes out your credit card. You try to buy groceries for the week (or some medication, or any number of important things) and your card is declined. That's annoying at the least. Or your debit card number is stolen, and your bank account is (temporarily) emptied. That can be seriously bad. This is for your own protection, as well as theirs.

These scenarios do happen, but the main reason debit card fraud is so disruptive is that the bank takes its sweet time (30+ days in some cases) investigating before crediting back the balance, yet they will decline transactions at the first sign of anything unusual without taking even basic steps to help their customers avoid embarrassment or other consequences. This disparity illustrates how any side benefit to customers is completely incidental to the bank protecting its own profits. Anyone who's seen first-hand the predatory overdraft traps that major banks lay for their poorest and most desperate customers knows that they are amoral thieves and liars.

[phongn]

* Cardholder present fraud, cardholder not present is a different issue.

In the US, it appears that EMV transactions will remain with the banks and processors. Magnetic stripe transactions shift liability to the retailer.

[Beowulf]

* Cardholder present fraud, cardholder not present is a different issue.

In the US, it appears that EMV transactions will remain with the banks and processors. Magnetic stripe transactions shift liability to the retailer.

"We show that the card was used with a PIN. Obviously you were the one to use it, so we're denying that the card was stolen. Pay up."

[Borgholio]

"We show that the card was used with a PIN. Obviously you were the one to use it, so we're denying that the card was stolen. Pay up."

You can fight that by claiming your card was skimmed. It's easier if they don't manage to get your PIN number of course but skimming does happen.