Jim Palermo: Placing holds on debit card purchases should be illegal

  • AP

Published: 8/7/2019 4:43:18 PM

Rampant abuses by the private sector are widely known — influence peddling and price gouging by pharma; disregard for safety in coal mines; and installing software in automobiles that will provide false test results regarding pollution standards.

But I suggest that the seemingly small abuses we suffer at the hands of corporate America are cumulatively just as lethal.

Case in point is the corporate arrogance displayed by a local mini-mart/gas station a few days ago.

On our way to dinner, we stopped to buy gasoline, for which I used my debit card. The following day, I was shocked to learn that in addition to the $25.58 I spent on gasoline, there was also a debit in the amount of $100 assessed on my account at the same time I made my purchase.

The next business day, I went to my bank to ask about the charge. I was informed that it was not a “charge,” but rather it was a “hold” placed on my account by the merchant. When I called the merchant to ask why it had put a hold on my account, the cheerfully polite representative explained that while credit card companies guarantee the merchant will be paid for the purchase, debit cards do not make such guarantees. Thus, they placed a hold on my account, in order to be certain the merchant would get its money.

What? I asked if the representative had ever given any thought to whether such a practice was moral. The response was along the lines that the merchant’s avoidance of any loss was of the highest priority, and that within three to five days, the hold on my account would be removed.

While I had sufficient funds to survive the hold, I wonder about the impact of the unnamed merchant’s practice of encumbering debit accounts might have on a young family that found itself between paychecks. For example, if they were on a road trip that required two fill-ups each way, they would have their account encumbered for $400. Or if such a family got gas before going shopping, their encumbered account might have insufficient funds to pay for food, or to pay for their child’s prescription medicine.

Business leaders complain they are over regulated by government. But without government regulation of non-human businesses, we human consumers are the hapless victims of corporate greed and arrogance. This practice should be illegal.

Jim Palermo


Daily Hampshire Gazette Office

115 Conz Street
Northampton, MA 01061


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