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bank question

C

car3

Member
This is purely a fictional situation.

---> A checking account is closed.
---> Netflix tries to debit $10 from closed account.

Is #1 or #2 below the correct outcome?

1. The bank ignores the debit because the account is closed. Netflix does not get paid and contacts customer for payment.

2. The bank pays Netflix the $10. The bank contacts customer for payment.
 
My vote goes for #1 as well. Why would the bank waste resource helping Netflix collect their money?
 
it would be #1. since it is a automatic debit from your checking account, that means it was sent as an ACH debit. If a bank is the RDFI on an ACH entry with a closed or invalid account, the item is returned to the ODFI.
however netflix would probably send you a bill since they have your address.
 
Originally posted by: xSauronx
Originally posted by: JS80
i've heard of #2 happening.
Click to expand...

on a closed account? banks actually take money from closed accounts?
Click to expand...

sometimes they let it go negative then send you a bill then to collections then on your credit report.
 
It's probably gonna be much worse than that. They might charge you a service fee for failed payment and put your account in debt (negative $).

It could be around $50 depending on the bank, but the interesting part is the bank will not pay Netflix the $10 you owe, they will simply charge you for the failed transaction and if Netflix attemps it again, you will be required to pay for a second failed attempt. Once you get past that you will still owe $10.

The fee shows up under a specific code on your statement, I'll try and see if I can find what that would be.
 
#1

The account is closed. It no longer exists. Debits and fees cannot be charged to it, nor to another account that might happen to be held by the same person that once held this now non-existent account. #2 does not happen. Nor are service fees charged by the bank. The receiving institution's position is that the originating institution attempted a transaction from an invalid account.

Netflix will contact the customer for payment, and will have the legal right to attempt to collect it.
 
Originally posted by: mordantmonkey
it would be #1. since it is a automatic debit from your checking account, that means it was sent as an ACH debit. If a bank is the RDFI on an ACH entry with a closed or invalid account, the item is returned to the ODFI.
however netflix would probably send you a bill since they have your address.
Click to expand...
This is completely accurate. This scenario will result in a returned item each and every time, without question. This is also a major fraud indicator for merchants as knowingly making a payment with a closed bank account is a felony.

 
Originally posted by: SarcasticDwarf
Originally posted by: xSauronx
Originally posted by: JS80
i've heard of #2 happening.
Click to expand...

on a closed account? banks actually take money from closed accounts?
Click to expand...



Yup, entirely true. This especially applies to checks.
Click to expand...
Complete bullsh!t. This can never happen. It's not possible without bank error which would soon be corrected, resulting in a returned item.

 
Originally posted by: Satchel
Originally posted by: SarcasticDwarf
Originally posted by: xSauronx
Originally posted by: JS80
i've heard of #2 happening.
Click to expand...

on a closed account? banks actually take money from closed accounts?
Click to expand...

Yup, entirely true. This especially applies to checks.
Click to expand...
Complete bullsh!t. This can never happen. It's not possible without bank error which would soon be corrected, resulting in a returned item.
Click to expand...

No, it's not BS. It happened to my brother... twice.

He had a checking account at Bank One for a long time, and he forgot that his debit card or acct# whatever was on file at some movie rental place (can't remember which one). I personally saw the "account closed" form that the bank sent him. About a year later, he got a call from the bank about his account, because it had been in overdraft status for something like eight months, accumulating fees and charges. For some reason, Your scenario #2 happened -- the bank accepted the transaction, but since there was nothing in his account, it overdrafted. He didn't get a notice of that, though, until after his account had been sent to collections & CheckSys (Chex? I can't remember, it's been about 3 years). He disputed it with the bank, and with one of the credit reporting agencies that he checked his credit with, but they both indicated that what happened was normal.
 
Originally posted by: GeekDrew
Originally posted by: Satchel
Originally posted by: SarcasticDwarf
Originally posted by: xSauronx
Originally posted by: JS80
i've heard of #2 happening.
Click to expand...

on a closed account? banks actually take money from closed accounts?
Click to expand...

Yup, entirely true. This especially applies to checks.
Click to expand...
Complete bullsh!t. This can never happen. It's not possible without bank error which would soon be corrected, resulting in a returned item.
Click to expand...

No, it's not BS. It happened to my brother... twice.

He had a checking account at Bank One for a long time, and he forgot that his debit card or acct# whatever was on file at some movie rental place (can't remember which one). I personally saw the "account closed" form that the bank sent him. About a year later, he got a call from the bank about his account, because it had been in overdraft status for something like eight months, accumulating fees and charges. For some reason, Your scenario #2 happened -- the bank accepted the transaction, but since there was nothing in his account, it overdrafted. He didn't get a notice of that, though, until after his account had been sent to collections & CheckSys (Chex? I can't remember, it's been about 3 years). He disputed it with the bank, and with one of the credit reporting agencies that he checked his credit with, but they both indicated that what happened was normal.
Click to expand...
Your scenario is only possible if the payment was made with a debit card. The OP scenario refers to check payments. Huge difference.

 
#2 For sure. Netflix will find you if your in Bejing or in Paris. The bank has record of where you live etc... If they cant contact you a collection agency will and say bye bye to that perfect FICO score
 
Originally posted by: Satchel
Originally posted by: GeekDrew
Originally posted by: Satchel
Originally posted by: SarcasticDwarf
Originally posted by: xSauronx
Originally posted by: JS80
i've heard of #2 happening.
Click to expand...

on a closed account? banks actually take money from closed accounts?
Click to expand...

Yup, entirely true. This especially applies to checks.
Click to expand...
Complete bullsh!t. This can never happen. It's not possible without bank error which would soon be corrected, resulting in a returned item.
Click to expand...

No, it's not BS. It happened to my brother... twice.

He had a checking account at Bank One for a long time, and he forgot that his debit card or acct# whatever was on file at some movie rental place (can't remember which one). I personally saw the "account closed" form that the bank sent him. About a year later, he got a call from the bank about his account, because it had been in overdraft status for something like eight months, accumulating fees and charges. For some reason, Your scenario #2 happened -- the bank accepted the transaction, but since there was nothing in his account, it overdrafted. He didn't get a notice of that, though, until after his account had been sent to collections & CheckSys (Chex? I can't remember, it's been about 3 years). He disputed it with the bank, and with one of the credit reporting agencies that he checked his credit with, but they both indicated that what happened was normal.
Click to expand...
Your scenario is only possible if the payment was made with a debit card. The OP scenario refers to check payments. Huge difference.
Click to expand...

It does? Where does it refer to check payments?
 
Originally posted by: GeekDrew
It does? Where does it refer to check payments?
Click to expand...
My apologies, the OP did not specify. It seems I was refering to this statement.
Originally posted by: SarcasticDwarf
Originally posted by: xSauronx
Originally posted by: JS80
i've heard of #2 happening.
Click to expand...

on a closed account? banks actually take money from closed accounts?
Click to expand...

Yup, entirely true. This especially applies to checks.
Click to expand...

 
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