You could be a terrorist...

[yvette7ica]

if you pay off too much on your credit card.

By BOB KERR
The Providence Journal
28-FEB-06

PROVIDENCE, R.I. -- Walter Soehnge is a retired Texas schoolteacher who traveled north with his wife, Deana, saw summer change to fall in Rhode Island and decided this was a place to stay for a while.

So the Soehnges live in Scituate now and Walter sometimes has breakfast at the Gentleman Farmer in Scituate Village, where he has passed the test and become a regular despite an accent that is definitely not local.

And it was there, at his usual table last week, that he told me that he was "madder than a panther with kerosene on his tail."

He says things like that. Texas does leave its mark on a man.

What got him so upset might seem trivial to some people who have learned to accept small infringements on their freedom as just part of the way things are in this age of terror-fed paranoia. It's that "everything changed after 9/11" thing.

But not Walter.

"We're a product of the '60s," he said. "We believe government should be way away from us in that regard."

He was referring to the recent decision by him and his wife to be responsible, to do the kind of thing that just about anyone would say makes good, solid financial sense.

They paid down some debt. The balance on their JCPenney Platinum MasterCard had gotten to an unhealthy level. So they sent in a large payment, a check for $6,522.

And an alarm went off. A red flag went up. The Soehnges' behavior was found questionable.

And all they did was pay down their debt. They didn't call a suspected terrorist on their cell phone. They didn't try to sneak a machine gun through customs.

They just paid a hefty chunk of their credit card balance. And they learned how frighteningly wide the net of suspicion has been cast.

After sending in the check, they checked online to see if their account had been duly credited. They learned that the check had arrived, but the amount available for credit on their account hadn't changed.

So Deana Soehnge called the credit-card company. Then Walter called.

"When you mess with my money, I want to know why," he said.

They both learned the same astounding piece of information about the little things that can set the threat sensors to beeping and blinking.

They were told, as they moved up the managerial ladder at the call center, that the amount they had sent in was much larger than their normal monthly payment. And if the increase hits a certain percentage higher than that normal payment, Homeland Security has to be notified. And the money doesn't move until the threat alert is lifted.

Walter called television stations, the American Civil Liberties Union and me. And he went on the Internet to see what he could learn. He learned about changes in something called the Bank Privacy Act.

"The more I'm on, the scarier it gets," he said. "It's scary how easily someone in Homeland Security can get permission to spy."

Eventually, his and his wife's money was freed up. The Soehnges were apparently found not to be promoting global terrorism under the guise of paying a credit-card bill. They never did learn how a large credit card payment can pose a security threat.

But the experience has been a reminder that a small piece of privacy has been surrendered. Walter Soehnge, who says he holds solid, middle-of-the-road American beliefs, worries about rights being lost.

"If it can happen to me, it can happen to others," he said.

Source (http://www.shns.com/shns/g_index2.cfm?action=detail&pk=RAISEALARM-02-28-06)

[Shlep]

So the current government has tightened up bankruptcy laws while criminalizing large-scale debt reduction? What the hell gives?

[jcarwash31]

Those damn fiscally responsible terrorists!

[Shlep]

Those damn fiscally responsible terrorists!

Osama didn't become a billionaire by throwing cash around like it was water, ya know!

[george]

This story is not accurate.

Nobody was looking at Mr. Soehnge as a potential terrorist; they were looking at him as a potential perpetrator of credit card fraud. Credit card fraud is investigated by the Secret Service, which - organizationally - falls under Homeland Security. One way of committing fraud is to send a bad check to a credit card issuer and, in the float time between the issuer's receipt of the bad check and the time it gets bounced back to them, the fraudster is free to use that credit to rack up more charges. As a way to prevent this, credit card issuers won't credit the account until the check clears if they sense something suspicious - such as paying an amount way out of proportion to your normal payments.

This activity is authorized by the DHS, but is a voluntary act performed by the credit card issuer. The stuff about "Homeland Security has to be notified" is not true. The credit card issuer may choose to notify the Secret Service (a branch of Homeland Security) if they suspect fraud, but there is no obligation to notify DHS.

Old hippies never die, they just get more easily confused.

[yvette7ica]

Thanks for clearing that up for me a bit. That does make a bit more sense. However, why is Secret Service involved and not another subset of homeland security?

[the happy prole]

The Secret Service has always been in charge of investigating credit card fraud. At least since the mid 80's. And it made a little bet of sense because they were part of the Department of Treasury.

When they formed Department of Homeland Security, they shifted over the Secret Service, but the Secret Service still kept all of it's old duties that were more financial than Presidential protection.

[lawdog]

Oh, damn, this thread isn't at all what I thought. I've been giving some consideration to exploring a new career, and I thought they maybe had an opening. Oh well, back to Monster.com...

[clemsonfan]

Yeah, when I used to work as a bank teller any suspicions of bank fraud or counterfeiting went to the Secret Service. We had to call them once when we came across a counterfeit twenty dollar bill. Incidently the counterfeit bill came out of a shipment we had just gotten from the feds.

[juggles]

Dang. I thought this was going to be about the Jeff Foxworthy of radical Islam.

[markalot]

I guess my own large payment wasn't large enough.

:rolleyes:

this is ridiculous...

Yea, I've payed over that amount via an online direct draft system and, as far as I know, haven't been watched. :cool: :(

[back2vinyl]

Oh, damn, this thread isn't at all what I thought. I've been giving some consideration to exploring a new career, and I thought they maybe had an opening. Oh well, back to Monster.com...

I've got a few people I'd like garroted if you are looking to make a little extra cash on the side.

[george]

Basically, this article doesn't pass the sniff test.

The source for all the information is an old guy named Walter who is angry that his JC Penney charge card payment wasn't processed as fast as he would like and who claims that there is a government conspiracy behind it.

Again, Walter is the only source ever cited in this article. No banking experts. Nobody from the feds. Nobody at the credit card company. Nobody from the ACLU. Nobody but Walter; and we are being asked to accept Walter's account as gospel truth.

Moreover, this story is two weeks old and nobody else has picked it up. The ACLU and "TV stations" have apparently been tipped to this story for at least that long and still the only story is this single piece from the Providence journal.

You are right, the Secret Service probably wouldn't be interested in nickel and dime stuff. Which is more reason to disbelieve this story.


They paid down some debt. The balance on their JCPenney Platinum MasterCard had gotten to an unhealthy level. So they sent in a large payment, a check for $6,522.

And an alarm went off. A red flag went up. The Soehnges' behavior was found questionable.

Who found the behavior questionable? What alarm went off? The author doesn't tell us.

And all they did was pay down their debt. They didn't call a suspected terrorist on their cell phone. They didn't try to sneak a machine gun through customs.

They just paid a hefty chunk of their credit card balance. And they learned how frighteningly wide the net of suspicion has been cast.
Dramatic, but it doesn't say anything.

After sending in the check, they checked online to see if their account had been duly credited. They learned that the check had arrived, but the amount available for credit on their account hadn't changed.
Where did they send their payment? Does it go to an administrative office first before going to a bank? Does that bank use Check 21? Does it use it the same day they receive the payment? Do they batch process all the payments a day after receipt? Was there a temporary technical problem? We don't know.

So Deana Soehnge called the credit-card company. Then Walter called.

"When you mess with my money, I want to know why," he said.

They both learned the same astounding piece of information about the little things that can set the threat sensors to beeping and blinking.
Threat sensors where? Again, they don't tell us.
What is the time frame? Did Walter check on-line every day? Did they make these calls as soon as they noticed they had not yet been fully credited? If so, this whole "ordeal" could have transpired over the course of ten minutes.

They were told, as they moved up the managerial ladder at the call center, that the amount they had sent in was much larger than their normal monthly payment. And if the increase hits a certain percentage higher than that normal payment, Homeland Security has to be notified. And the money doesn't move until the threat alert is lifted.
Notice the article says "they were told." The article never says that this is accurate; simply that Walter claims this is what somebody told him. Did the author verify this with the credit card company? If so, why doesn't he say so. Did he verify this with Homeland Security? If so, why doesn't he say so.

Frankly, I think it is entirely possible that somebody at JC Penney didn't want to deal with an irate customer so they decided to pass the buck and claim that their hands were tied. "I'm sorry sir, it's a Homeland Security thing. There's nothing I can do about it"

Walter called television stations, the American Civil Liberties Union and me. And he went on the Internet to see what he could learn. He learned about changes in something called the Bank Privacy Act.
If this story was really true and Homeland Security was really monitoring the payment patterns of American consumers - and TV stations and the ACLU were all informed of this, why is the only story on this issue found in the Providence Journal? This story is two weeks old. If it had any legs, somebody (anybody!!) would also have written about it.

"The more I'm on, the scarier it gets," he said. "It's scary how easily someone in Homeland Security can get permission to spy."
Again, Walter is the only source here.

Eventually, his and his wife's money was freed up. The Soehnges were apparently found not to be promoting global terrorism under the guise of paying a credit-card bill. They never did learn how a large credit card payment can pose a security threat.
What's "eventually?" At the end of the ten minute phone call? The next day when the bank processed the payment?

But the experience has been a reminder that a small piece of privacy has been surrendered. Walter Soehnge, who says he holds solid, middle-of-the-road American beliefs, worries about rights being lost.

"If it can happen to me, it can happen to others," he said.

Dramatic, but, again, says nothing.

[george]

Unfortunately, nothing in your post substantiates what you said in your earlier post. I think it actually makes my case. My point was that given the lack of detail in the actual story and the absence of any additional followup, the speculation on credit card fraud and Secret Service investigations seemed forced.

How so?

What is the more likely scenario -- a retired schoolteacher stumbled upon a previously unknown and apparently secret government terrorist surveillance program - or - as part of routine fraud avoidance practices, a credit card issuer waited for a check to clear before crediting the customer's account?

I'm not saying Walter is a fraudster. I'm also not saying that the Secret Service (which is a part of Homeland Security and is in charge of investigating credit card fraud - source (http://www.dhs.gov/dhspublic/display?theme=79&content=271)) actually investigated him.

I still don't see anything there to back up that contention. If you want to ding the individual writing the article for a sloppy job, that's fine. But the second post is more along the lines of what I would have expected.

To back up what contention? That his payment was not credited immediately because the credit card company held up the credit until the check cleared?

You are right -- I don't have any concrete evidence. However, common sense (and 10+ years in the banking and finance industries) tells me that is a far, far, far, likelier scenario than bells, whistles, and alarms going off in some anti-terrorist headquarters in Washington.

And that also misses what could be the real hidden story. While it is fairly unusual for banks to investigate large payments(considering it's by check, which is also traceable), and even more unusual to get the SS involved, it is not unusual for companies to structure their internal crediting policies towards a delayed posting of payments. Several days worth of accumulated interest on a large balance is a fine incentive to drag things out. And a number of large banking institutions have been investigated for this in the past. My concern here is that the institution may have just used security as a convenient excuse in order to collect a few extra bucks. And that's pretty shabby if that's the case.

That may be the case. Again, that points away from the terrorist angle.

Also note that JC Penney's credit card website clearly states: payments may take up to 3 days to post to your account. (https://www.onlinecreditcenter2.com/JCPenney/occ-pay.html)

I mean, bad reporting is bad reporting, but it doesn't necessarily mean certain facts within the story may, in fact, be true. Just because someone has a bad lawyer doesn't mean he was actually guilty. It just means he had a bad lawyer. Local columns of any political viewpoint generally tend to be of the same quality as this one. That's the price you pay when you are selling to an audience with reduced attention spans.

Incomplete: yes, inaccurate: indeterminable from the text.

Okay. I'll take back the "innacurate" charge. I don't know Walter Soehnge, nor do I work for anybody mentioned in the story. I am not familiar with the intimate details of this specific transaction.

That being said, I would wager any amount of money that my take on this case is far closer to the truth than this (seemingly) fraudulent article. The Providence Journal at least had the foresight to print this as an editorial, since there are no verified facts in the story itself. A first-year journalism student would get a failing grade on this story. I think it's beyond bad reporting.

[george]

Just as, without a verifiable rebuttal, you asked us to accept yours.?

You're right.

Please don't accept my version either -- analyze the article yourself, apply common sense to it, and draw your own conclusions.

Please tell me a bank that does not use Check 21. Banks were the primary drivers of the law, since it reduced their costs dramatically, and overnight destroyed the capability of floating checks for any significant interval,

I have two bank credit cards. I send the payments on the same day, to the same city. One takes more than twice the time to process the payment as the other. One payment shows up on my bank account statement as an electronic debit, the other as a cashed check. Clearly different organizations process payments differently.

Check 21 is not mandatory - The law does not require banks to accept checks in electronic form nor does it require banks to use the new authority granted by the Act to create substitute checks. (http://www.federalreserve.gov/paymentsystems/truncation/)

Moreover, we do not know where Walter sent the check. Was it a bank? Was it a clearinghouse for credit card accounting? Was payment made online?

That may be what happened, and not actually being a lawyer I will admit to being hazy on this. But it strikes me that that representing a business practice as the work of a government agency without basis might just be illegal.

It might be -- I don't know either.

I used to tend bar. One of the guys I worked with didn't like it when kids would take up valuable stool space at the bar, so he got into the habit of telling people that it was a violation of state alcohol laws for minors to sit at the bar. That's not true, but it was easier than telling people that he didn't want their kids at the bar because kids don't run up big tabs.

The point is, people pass the buck all the time. And claiming some sort of government regulation is a great way of doing it because it makes it look like you can't do anything about it.


Just because a story doesn't get "picked up" says nothing about it's accuracy. It has more to do with whatever was occurring at the same time and the amount of similar news that was taking place concurrently. It hasn't been all that unusual to see a story finally get picked up by the nationals weeks or months after a local airing. And where were TV stations and the ACLU mentioned, btw?

In and of itself, whether a story gets picked up does not say anything about its accuracy. However, when that story concerns a heretofore unknown government surveillance of the everyday financial transactions of ordinary Americans, it is a huge story and certainly would have been picked up if it were accurate.

Edited to answer your last question-

The following is lifted right from the source article:
"Walter called television stations, the American Civil Liberties Union and me."

[crazybob60]

My brother helped me pay off my credit card because he has a more financially stable job right now (as opposed to mine where I don't have a job at all) just so I don't incur unwanted interest charges and fees and such, its nice to know that my brother is doing me a good deed and we might be thought of as this....sorry if this thread has gone a different direction...I just read the first post and that was it.