First of two parts
What if you knew you were about to get mugged and called the law, only to be told that you had to let the bad guy finish the job?
That's pretty much what Denise Stanco, a 54-year-old information technology specialist, experienced recently when a credit-monitoring service called last month to ask her about some unusual charges on her Visa debit card.
When she called Securityplus Federal Credit Union to tell them she did not buy the $1,204 Gulf Air tickets, the $872 Birkenstock shoes, or the $2,500 Asian Air tickets that were charged to her account, Securityplus told her that the charges had not been deducted from her checking account yet.
Oh, happy day! Stanco thought. All $2,189 that she owned was still there. There was still time to save her money from being swiped by evildoers, right?
Stanco's tale is so outrageously infuriating, it'll either make you laugh (not ha-ha funny, but ha-ha WHAT?!) or make you cry. Because try as she might, no one seemed to want to help her stop a theft in progress.
"They told me I had to file a police report and then fill out a fraud report with them [the credit union]," said Stanco, a Catonsville resident who works for the Social Security Administration.
OK. That makes sense.
"They froze my debit card number," Stanco said. "They told me I couldn't touch the funds in my account, which I thought meant that the thieves couldn't get to my money either."
Again, makes sense.
"But the odd and frustrating thing is," Stanco said. "my credit union told me that before they could do anything to help me, I had to let the fraudulent transactions complete processing first."
"I know! I was just incredulous," Stanco said. "I had to ask the credit union person three times, 'So you still have my money, you know it's fraud, and yet, you're telling me that you're going to release the funds and I have to sit idly by while I'm getting ripped off?' She said, 'Yes.' I said that was stupid."
Stanco's problem is that she was thinking logically. Logically, if you warn a business about a crime that's happening, perhaps there's a chance that the business will take some sort of action to stop it from being completed.
Please toss your silly notions of logic out the window.
Bear in mind that everyone she turned to for help did try to help her. But most only succeeded in pushing her deeper into a maze of utter absurdity.
Ed Campbell, assistant vice president of marketing at Woodlawn-based Securityplus, said sales transactions transpire in two parts: the authorization and then the posting.
In the authorization part, a retailer swipes your card and the information about that sale is sent to your bank or credit union. The financial institution confirms that there is enough money in the account to cover the transaction and sends a message back to the merchant to authorize the sale.
Authorization has nothing to do with the account holder (in this case, Stanco) or the financial institution (in this case, Securityplus) ensuring that the charge is legitimate. It merely means there's sufficient money in the account to cover the charge.
Once the authorization occurs, the second part of a sales transaction is the posting, which is the time it takes for the funds to clear the account. Sometimes, postings can take a few days to process.
"Systematically, the way we're set up, you're just not allowed to disallow a [transaction] once it's been authorized," Campbell said. "It sounds crazy, but once the authorization goes through, we have to allow the charge to post. We've already told the merchant that the money is available."
So even though the credit union or bank is aware that a transaction may be or is definitely fraudulent, their hands are tied once the sale is authorized.
That means the consumer's hands are tied, too. So despite serious reservations, Stanco did as she was told.
She waited for the mugging to continue.
On Aug. 6, three days after she was warned about the fraud, Securityplus released the funds for the Gulf Air tickets. The credit union did reject the Asian Air charge - but only because Stanco at this point had insufficient funds in her account. The Birkenstock charge was still waiting to clear.
Now that one fraud had been committed against her, she contacted the Baltimore County police. Because the crime wasn't an emergency, she ended up driving to the local precinct where she asked a "very nice and polite" officer to help her file a report. She said he told her that "they were unable to help me because they needed to know who the thief was and whether he was in my county of residence in order to investigate the crime."
It certainly would make it easier on law enforcement everywhere if victims all knew who was victimizing them and where this unsavory person could be located, yes?
"I told him I had no idea where the thief was and that I didn't need them to investigate," Stanco said. "I just needed a police report for my credit union. Couldn't he just fill out a report without investigating? He said no, that wasn't possible."
The officer then directed her to fill out a form with www.ic3.gov, a partnership between the FBI and the National White Collar Crime Center where cybercrimes are reported. Again, wrong.
"I believe the officer was confused," said Baltimore County police spokesman Bill Toohey. "We lobbied really hard to have a law passed in the state that says crimes can be investigated in the jurisdiction where the crime happened. If the victim is in Baltimore County, we can investigate."
Should you ever encounter some resistance when stuck in a similar situation, Toohey says a report must be filed with the ic3 Web site if the victim makes a purchase online and is defrauded in some way. If the victim's identity or account is stolen to make a purchase online, however, then the local police can step in to take a report and investigate.
"If you're told that you can't have a police report filed, go over the officer's head and speak to the precinct commander," Toohey advised.
Stanco had no clue of this. She took the officer's word at face value.
Without a police report, Stanco printed a copy of the report she filed on the ic3 Web site and used it to file the fraud report with Securityplus.
Even then, she was already out $1,204 for the Gulf Air tickets and she was still waiting for the Birkenstock charge to clear.
Feeling more frustrated by the minute as she continued waiting to lose the rest of her money, Stanco said she resorted to pleading.
"I begged my credit union to give me access to the remaining funds in my account so I could move the money," Stanco said. "I told them I didn't want to wait until the thief took the rest of my money. I didn't understand why I had to give the crook the rest of my money."
Stanco was finally permitted to close the account and open a new one. She didn't stop there. She e-mailed the president of Gulf Air in the Kingdom of Bahrain two or three times to try to get a response.
Stanco wanted justice. If she couldn't get it here, she was going to try her luck overseas.
To borrow a page from those old-time radio serials. ... Tune in next week when Gulf Air responds to Stanco's sorry situation and see if anyone will come to her rescue.
Will Stanco save the rest of her money?
Will anyone try to nab the bad guys?
Should Securityplus get the stink-eye for allowing a fraudulent charge to go through?
Is the system seriously flawed?
Find out in next week's concluding episode.
Reach Consuming Interests by e-mail at consuminginterests @baltsun.com or by phone at 410-332-6151. Find an archive of Consuming Interest columns at baltimoresun.com/consuming.