I've worked bank fraud for 25 years. Your card can be hacked virtually anywhere... could be a data access on the part of the merchant, someone actually swiping your card into an encoding machine, a keystroke logger on your computer. Personally, I use paypal, but I have paypal linked to a credit card, not my bank account. I have greater dispute privileges that way. Nancy_Drew is right, though, the danger with the debit card is your checking account has the potential to be drained quickly, and the banks aren't necessarily quick about putting the money back in. Dawiff, your suspicions may very well be correct, but you should make sure you don't have any malware on your computer..

I'm appropriately wary of infections and phishing attempts, and am very computer-aware, have a hardware firewall on my broadband service in addition to a software firewall, antivirus, antispamware, and I don't use IE for browsing. For online purchases I use a CitiBank card that carries a virtual account number feature. A cardnumber was stolen once at an online site, but it was a virtual number so the transaction for it had already been run and the perps couldn't get any success with the number. Quoted from http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre04.shtm: ATM or Debit Card Loss or Fraudulent Transfers (EFTA). Your liability under [U.S.] federal law for unauthorized use of your ATM or debit card depends on how quickly you report the loss. If you report an ATM or debit card missing before it's used without your permission, the EFTA says the card issuer cannot hold you responsible for any unauthorized transfers. If unauthorized use occurs before you report it, your liability under federal law depends on how quickly you report the loss. For example, if you report the loss within two business days after you realize your card is missing, you will not be responsible for more than $50 for unauthorized use. However, if you don't report the loss within two business days after you discover the loss, you could lose up to $500 because of an unauthorized transfer. You also risk unlimited loss if you fail to report an unauthorized transfer within 60 days after your bank statement containing unauthorized use is mailed to you. That means you could lose all the money in your bank account and the unused portion of your line of credit established for overdrafts. However, for unauthorized transfers involving only your debit card number (not the loss of the card), you are liable only for transfers that occur after 60 days following the mailing of your bank statement containing the unauthorized use and before you report the loss. If unauthorized transfers show up on your bank statement, report them to the card issuer as quickly as possible. Once you've reported the loss of your ATM or debit card, you cannot be held liable for additional unauthorized transfers that occur after that time.

Don't forget that the S&L debacle of the 80's was also triggered by changes instituted by our government. Income tax law changes made the ownership of real estate much more financially rewarding, which of course created a higher demand for real estate, thereby drove up the price. Developers saw a fabulous market and built more and more office buildings, shopping centers, apartment buildings, etc. At about the same time S&L's were allowed to invest in more types of loans and other investments. This was done in part because they were being creamed holding long-term low-rate home loans and paying out high interest on deposits. 15% CD's were not unheard of at that time, and 12% were common. Meanwhile the 30 year mortgages they had made a few years back were only paying 5 or 6% interest to the S&L's. These changes were both made by the government, but not as a concerted effort. In each case the laws were changed to address one issue. Then, at about the same time most S&L's had a lot of money lent on overpriced real estate, Congress decided to change real estate tax laws again - making real estate a less attractive investment. Not surprisingly, real estate values tanked at a time when many markets were way overbuilt to begin with. S&L's were left with loans that had looked solid at one point and found themselves having to foreclose loans on buildings that they couldn't sell and could sometimes could not even lease out. Yes there were crooks in the S&L business, who helped ruin some institutions, and we all read about those. But plenty of honest institutions found themselves in severe trouble as well. I worked for a life insurance holding company, managing income property loans. I made a career change just before the bottom dropped out, but I still talked with several people who had to deal with that mess. In the case of my former employer, they stopped making new loans in Texas when the markets started getting overbuilt. But they still had plenty of existing loans when the markets tanked. Being a nationwide company, only a small percentage of their loans were in severely depressed markets. But S&L's generally lent in their immediate area, or at least their home state. I don't remember if this was due to regulation or custom. At any rate, even the best-run S&L in many markets nearly collapsed. ------------------------------ Whew, I didn't mean to write so much! At any rate, my point is that the best-intentioned body of lawmakers will never understand every ramification of the laws they pass. They can easily cause as many problems as they fix. In the case of the unreasonable debit card holds, it really is a minute percentage of institutions that do this. In this case, I believe the gas station is the party at fault. In the whole debit-card system, banks have no way of verifying the amounts that merchants submit. Most merchants are honest and reasonably careful - if for no other reason than that they want repeat business.

Happened again! I posted here on 12/18/07 & on 1/14/08 the same exact thing happened w/ a completely different bank account. The only difference was the amount was $9.55 instead of $9.87 & the company name was World Wide Services (just FYI the other company name was PictureGlobus.com). I contacted my bank & they said that if I wanted to dispute it I could, but my debit card would be cancelled immediately, well, I had some purchases to make & only had my debit card, since I hate carrying cash, so told them to hold off. Well, I couldn't call on Monday (holiday) so I planned to call 1st thing Tues. morning. Well, I checked my online bank 1st & sure enough, the money had been refunded. I did go ahead & call & have my card cancelled which worked out perfectly since I had just ordered a new one w/ my new (married) name on it. I just find this so odd. I'm a little paranoid about it now actually. I don't think both of my banks (one has nothing to do w/ the other) could've made this almost exact mistake and w/ me as the common denominator... weird. I just caution everyone, b/c apparently nothing is secure anymore. I am scared to purchase anything or pay bills online now (or over the phone for that matter). I'm even getting more paranoid about paying @ restaurants w/ debit... I've seen receipts before w/ the whole card #, not just the last 4 digits. I will start marking these out!