Mike said:
Banking rules say you have to process the day's deposits before the
day's withdrawals.
Basically, you post the transaction to a transaction file which is
applied to the account after the cutoff time.
No. This is a general accounting rule. (And actually, the rule is that
transactions should be processed in the order received by an agent of the
company/bank.)
It is a bank, not a banking rule that you allude to.
I have personally experienced many banks (and subsequently moved my holdings
to a new bank once I found this out) which apply withdrawls first, apply fines
if this causes balance issues, and then apply deposits. I suggest that this is
actually the banking rule used by most banks.
Worse yet, are the banks which hold deposits for days (most importantly
including government checks and direct deposits or banking transfers which
should be instantaneous, IMHO) solely so that they can gain interest on held
client monies *before* they credit the deposit to their client - despite what
effect that has on their client. (I know of several elderly folk who have been
burned by very big, national banks who practice this regularly on SSI or
Military payments from the government to them.)
The entire world wide banking system is corrupt and fully self serving. Look
at how Iceland has reacted to this, actions taken and reforms enacted.
It's this client cavalier attitude of the banking industry that looks for cheap
vs. quality solutions. From the articles cited thusfar, this debacle is a
result of that mindset.
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