
Using GameStop as a bank - seivan
http://kottke.org/14/03/the-first-national-bank-of-gamestop
======
noonespecial
Consider a venn diagram containing "people smart enough to game GameStop into
being their bank", "people not smart enough to avoid overdrafts", and "people
not creative enough just to set up a prepaid debit card system for
themselves". In the overlapping space of these three circles, you'll find this
guy, and a very confused leprechaun riding a unicorn.

~~~
ubernostrum
_people not smart enough to avoid overdrafts_

Remember that historically, banks have processed transactions in whatever
order is most likely to produce an overdraft, even if the same set of
transactions, processed in chronological order, would not produce an
overdraft. Also note that the complaint is not that he overdrafted, but that
he can't turn off the overdraft "protection" that charges him a fee -- he'd
rather just have the transaction declined, and can't get his bank to do that.

~~~
cordite
Can you produce a source on the "banks have processed transactions in whatever
order is most likely to produce an overdraft"?

~~~
anigbrowl
Here's an example: [http://consumerist.com/2013/10/22/bank-of-america-stops-
over...](http://consumerist.com/2013/10/22/bank-of-america-stops-overdraft-
friendly-practice-of-re-ordering-transactions-from-high-to-low/)

Most big banks have done this for a while and only recently abandoned or are
abandoning the practice. I anticipate a large class-ation suit and payout
within the next few years, because they took this to wildly abusive levels.
For example a few years ago I went out one day and made 2 small (<$10) debit
card purchases, passed an ATM of my bank and made a cash deposit, and then
made a larger purchase an hour later (which was why I had deposited the cash,
as I had a low balance). Chronologically this was all good, but thanks to
transaction re-ordering I got hit with $105 in fees (#35 x 3).* I got it
reversed, but the sad fact is that for a long time the transactions shown on
your account and your available balance were treated as fictions to be re-
arranged at the bank's convenience if doing so would yield fee income.

* _eg for illustration, though I don 't remember the specifics:_
    
    
      a. starting balance       $30
      b. debit card      -$10 = $20
      c. debit card      -$10 = $10
      d. cash deposit    +$60 = $70
      e. debit card      -$65 = $ 5
    

_Which all looked fine at the time (eg checking recent transactions and
available balance at ATM following deposit), but 24 hours later the
transactions had been reordered from smallest to largest and my account looked
like this:_

    
    
      a. starting balance       $30
      e. debit card      -$65 =-$35
      A. Overdraft fee!  -$35 =-$70
      d. cash deposit    +$60 =-$10
      b. debit card      -$10 =-$20
      B. Overdraft fee!  -$35 =-$55
      c. debit card      -$10 =-$65
      C. Overdraft fee!  -$35=-$100
    

_I wish I were making this up, but sadly not. I was just lucky enough to have
the smarts and time to go into a branch and browbeat a manager into getting
the charges reversed. However, my understanding is that millions of people
have been ripped off by this trick in recent years._

~~~
cordite
Most accountants would list numbers and place them in ()'s for negative
values.

This really breaks my mind when it comes to transactions though, as ALL
transactions SHOULD be globally ordered.

------
dimitar
This is finance. Anon is storing his assets, dealing with uncertainty.

In 'Poor Economics' there was a chapter about saving in West Africa.
Apparently the way some people there do it by contributing some money in a
pool on a periodical basis and each time the group meets, the pool is
immediately given to one member, whose turn it is. So if you are in $10-per
day group that withdraws once a month, you can be sure that once every 30 days
you'll withdraw your $300, without worrying too much about banks, withdrawal
fees, etc.

~~~
mmmdelishus
It's actually very widespread in all sorts of countries and cultures.

There was a good Planet Money show that talked about it here:
[http://www.npr.org/blogs/money/2013/06/18/193176928/episode-...](http://www.npr.org/blogs/money/2013/06/18/193176928/episode-466-diy-
finance)

[http://en.wikipedia.org/wiki/Susu_(savings)](http://en.wikipedia.org/wiki/Susu_\(savings\))

~~~
jdn
What is going on with that Wikipedia article. The first two sentences are
written badly to the point of being incomprehensible.

------
josu
This seems like satire to me, I wouldn't read to much into it. And I think
that the fact that some people are taking it seriously just proves that it's
actually pretty good satire.

~~~
teraflop
"The stories and information posted here are artistic works of fiction and
falsehood. Only a fool would take anything posted here as fact."

~~~
unknownian
That's only /b/ though. Based on post numbers this is from /v/, but yeah,
anyone can lie.

------
gfodor
Two words: counterparty risk.

If GameStop goes under, I don't know where "customers who have pre-orders" end
up on the line of 'creditors'.

~~~
fiatmoney
Same as other unsecured creditors, unless the company convinces the bankruptcy
court & the other creditors it's to the benefit of the business in the long
run to give them what they paid for.

Most corporate bankruptcies are restructurings, not liquidations.

------
ivanca
Instead of posting judgement over this guy it would be more interesting to
talk about other financial hacks.

One 'hack' I do is to use my credit card outside my country, but when I get
paid in my own country my family repays the credit card debt with that money;
is cheaper than using wire-transfer (i.e. western union) or direct bank
transfer.

~~~
arjie
I'm not sure if I understand. Essentially you're saying your credit card
company has a better exchange rate than the other two services?

~~~
pak
Yes, I can believe that is what he is saying. Certain banks/credit cards have
relationships with foreign institutions that can cause unexpectedly low fees,
given the right circumstances. On top of which, I've found that both Western
Union and bank-to-bank transfers, on the whole, are a huge ripoff on both
rates and fees--especially for frequent, small volume scenarios.

When I worked in Canada, I used the no-ATM-fee agreement [1] between
ScotiaBank and Bank of America to convert USD to CAD and transfer money
between the accounts. This involved the rather odd procedure of going to a
ScotiaBank ATM, withdrawing a lot of CAD off of the USD in the BofA account,
and stuffing the cash right back into the ATM as a deposit on the ScotiaBank
account. Any other procedure, including using a teller or trying an online
wire transfer, would have been more expensive and inconvenient. The above had
no per-transaction fees and only a 3% conversion fee added to the market rate,
which is about average compared to credit cards. (Any of Western Union's
"instant" options for this kind of transaction require about 9% in fees.)

There are some credit cards with no foreign transaction fees, which is what I
would use today if I had to do it again. Using such a card to purchase items
in the foreign country, and then paying off the balance with the home country
bank, results in "free" currency conversion. That's what GP is referring to.

[1]:
[http://en.wikipedia.org/wiki/Global_ATM_Alliance](http://en.wikipedia.org/wiki/Global_ATM_Alliance)

~~~
dnr
Yup, I did the same thing in China by withdrawing RMB from my bank account at
Bank of America at a China Construction Bank ATM and immediately depositing it
in my local account. Zero fees and good exchange rate.

The only annoying part was that the amount I needed to pay my initial rent +
security deposit was more than my daily withdrawal limit, so I had to transfer
up to the limit three days in a row to get enough money in there to start.

~~~
rahimnathwani
I heard from a colleague that this deal no longer exists.

I opened a CCB account before my last trip to the US. I was charged a 3USD ATM
fee at the BofA ATM. I don't know what exchange rate was applied when the
303USD was converted to CNY, but most Chinese banks load these transactions
much less than those in the UK (which usually charge 2.25% to 2.75% above the
Visa wholesale rate).

~~~
dnr
Yeah, that was in 2009. I don't know if CCB/BoA still have the no-fee
agreement.

But now I have a checking account at Schwab that refunds all ATM fees,
including internationally, so I could do it with that.

------
derekp7
This guy complains about overdraft fees. Isn't the simple solution not to
overdraft? Almost any bank has online access to your account, and ATM/Debit
transactions seem to show up immediately. If you are getting toward the end of
your pay cycle, make a daily check of your balance. Have a habit of mentally
subtracting some fixed amount (say, 1,000) from your balance whenever you look
at it, so you always have a cushion too. BTW, when you have a bank turn off
overdraft privileges, that applies to your debit card only (i.e., instead of
letting a transaction go through it will get denied at the terminal). But any
check or automatic withdraw will still generate an overdraft fee.

If you need something a bit simpler, set up two accounts -- one for recurring
bills, a second one just for your debit card. Have your paycheck split
accordingly between the two accounts (or set up an bi-weekly transfer to
coincide with your paycheck deposits). Any utility bills, mortgage / rent
payment, etc comes out of the bills account. Then you never miss an important
bill payment. Bonus -- to make this work, you need a bit more going into the
bills account than what goes out. At the end of the year, you will then have a
surprise savings balance sitting there.

~~~
thefreeman
Man, no offense, but you sound like someone who has never worked paycheck to
paycheck. I'm not endorsing his banking scheme, but I can sympathize with the
shityt overdraft fees are.

Also "seem to come in order" is not really good enough when you are down to 5
or 10 dollars left. Also, I have seen many examples of banks processing things
out of order to maximize the overdraft fees. Ie. processing larger
transactions before smaller ones that occured before them chronologically, so
that a number of 4 or 5 dollar purchases would end up each having a $35
overdraft fee.

For 95% of situations it would be much more in the customers interest to just
reject the transactions. But the banks make a killing off of exploiting the
people who can least afford it (those with almost no money in their account).

edit: downvotes? Anyone care to actually tell me what is downvote worthy in
this post? The guy's recommendation to "subtract 1000" from whatever your
balance is is totally infeasible for a large portion of the population.

~~~
Crake
> The guy's recommendation to "subtract 1000" from whatever your balance is is
> totally infeasible for a large portion of the population.

I liked how the example used $1000, too. As if poor people even have that much
_in total_. A better example would have been +/\- $10, but a lot of people
here have absolutely no comprehension of poverty in the US.

~~~
derekp7
My apologies -- I meant 100, hit an extra key. And for the record, yes I am
currently living mostly paycheck to paycheck, although I make decent money (my
own fault -- I've got a live-in significant other, she can't work any more due
to disability, and I've had to take over her expenses, including car payment
[her's and one of her kid's), meds, etc.) But even so, I'm able to do odd jobs
for people, and that all goes into a buffer balance. Yes, I can't compare
myself to someone on minimum wage, but when everything you make goes to
existing obligations (again, I could have said no to a lot of things, but when
it is the choice between more credit card debt for a vet bill, and putting
down a pet that has been instrumental in drawing a certain family member out
of deep depression...)

------
dcc1
I doubt Gamestop accountants are too thrilled about having to do extra work,
or potentially be accused of money laundering or running an unlicensed money
transmitted business.

They can put an end to this overnight by having a simple TOC having to be
signed on every preorder. In US you wouldn't want to break TOC...

------
Houshalter
I think the larger point of this is that this guy found a system not intended
for this at all, and it still works better than businesses set up for this
purpose.

~~~
notahacker
I dunno, my bank not only pays me 3% interest on a current account with free
withdrawals from most ATMs and free payments to other bank accounts, it also
doesn't send me computer games I don't want if I don't forget to cancel them.

~~~
Nicholas_C
What bank pays 3%?

~~~
notahacker
Santander in the UK. It's a big market share ploy, but it's a good one, and
there isn't really any catch.

------
moot
Quality contribution(s) in an anonymous community? Who'd a thunk!

------
anon4
If anyone wishes for whatever reason to read the original thread,
[http://archive.foolz.us/v/thread/235956257/#235956257](http://archive.foolz.us/v/thread/235956257/#235956257)
here. Caution: it may contain content that you find offensive, but was posted
in jest in the original context. There is also content that is offensive and
posted with the intent to offend. There is also content that is funny, but was
posted with the intent to offend. There is no known algorithm to distinguish
between them. Read with caution. Images are not archived, only thumbnails.

Edit: And before I forget. This thread is on the videogames board, but some
people post pictures of anime girls wearing clothes. I've seen people get
extremely angry at that practise, so if you're one of them, turn images off or
something.

------
Kluny
Really? That's what passes for journalism? Straight up copy garbage from
reddit, which copied it from 4chan, and republish it without adding ANY
original thought to it? That's normal on Buzzfeed, but I didn't know
kottke.org was this worthless.

~~~
zwily
Kottke isn't a journalist, he's a blogger.

------
webwielder
Gamification is clearly the future of banking.

------
ulfw
Or he could... just... I dunno. Use cash. If cash = empty, then no more
purchase? Because clearly the guy can't handle his finances using debit cards
and keeps on overdrafting his account.

~~~
icebraining
By using cash, if his/her house gets robbed, s/he would lose the whole
paycheck. Hell, for all we know, s/he might not even be able to trust the
people s/he lives with.

~~~
ulfw
Yea and gamespot might go bankrupt or a meteor could hit him on the head. I
mean we aren't talking large sums of money here if he is over drafting his
checking regularly.

------
kenrikm
Why not just use a reload-able prepaid debit card if he/she is that bad at
managing money? Managing your bank account is not that difficult.

I bank with Chase and they warn you if you get under the notification level
you set, my phone will actually vibrate in my pocket with the message just
after I swipe the card. Also even if you do overdraft and you get notified
(with Chase)and can go make a cash deposit that same day and they won't charge
you any fees. BOA is a different beast, stay far, far away from BOA if you
can.

------
gambiting
It strikes me as really weird that a company would take your money for a
preorder. It's not really a thing here in the UK, I don't think. Amazon
certainly doesn't take my money before the product actually ships, and large
stores like GAME or HMV only take a small, non-refundable deposit.

~~~
joshvm
When I worked at GAME we didn't even take a deposit. Managers are pushed to
get as many preorders as they can, and as a store it directly affects how many
units of a game you get in so there's a big incentive there. It got to the
point when we'd ask people if they wanted to preorder anything just in case
they wanted it later; there was no obligation to buy it so no harm to the
customer and the store would benefit by getting more stock.

It was always fun looking at the preorder list.. there were quite a few
vapourware titles on it.

------
tehwebguy
Or just buy games with your rewards credit card, return them for a cash
refund, then pay off your credit card bill with the cash.

You can return new games if they are unopened, used games within 7 days. You
get free points and GameStop foots the bill for the credit card fee.

Not sure if it's illegal, but definitely a dick move.

~~~
fiatmoney
Every store I've heard of refunds credit card purchases to the card in
question, not cash (although with a no-receipt you can sometimes exchange it
for store credit, & possibly sell that at a smaller discount than the rewards
payoff), and every credit card I've ever heard of doesn't give you rewards if
the charges are reversed (either because of a refund or a chargeback).

Many stores (eg, Home Depot) also track their customers' refunds and will stop
allowing you to return merchandise if you're an outlier.

~~~
tehwebguy
Right, but GameStop lets you return credit card purchases for cash.

Just last month I returned a used game that I didn't like they gave me cash
even though the original purchase was with a credit card.

My guess is that since they've already eaten the processing % to debit your
card they don't want to pay it again to credit your card. Not sure if large
scale retail still pays on the reverse, I'm assuming.

------
robobro
Bet that works real well for paying bills / making online purchases

------
aosmith
This is retarded. What happens if GameStop goes belly up? You could be out the
games and the money. I think this must be a trolling.

~~~
gesman
Games are like porn - is the best way for people to procrastinate and delay
facing the real life issues.

This industry will die the last.

~~~
aosmith
I realize the game industry won't go away overnight but individual companies
will always come and go. The same plan would have been equally plausible with
CD stores in the 90's.

------
vxNsr
I'm kinda confused, has this dude never heard of Credit cards? Or is he
already so bad at money that his credit score is too low?

------
spajus
Sounds better than keeping your money in bitcoins

------
warmwaffles
Money laundering?

~~~
kennywinker
Walmart gives cash back when you return something purchased on a credit card.
Not sure what the parameters of this are, but I had it happen once with a
~$300 purchase and it was weird and very "money launder-y"

~~~
brownbat
Walmart gift cards on cardpool.com generally have a pretty tight spread and
high supply (liquidity?).

I'm kind of curious how many Walmart cards are actually bought as a legitimate
gift rather than as some kind of vehicle to transfer money.

------
hendzen
I guess Aaron Greenspan needs to sue Gamestop now...

