Comment by _qulr | Hacker News Reader

Comment by _qulr | Hacker News Reader

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> If you owe money on the App Store because maybe your non-Apple card expired and you never updated it, Apple will shut down your account still.

That's not what happened though. His credit card didn't expire. His credit card was the Apple Card.

With any other credit card, the merchant gets their money regardless of whether the card holder pays their credit card bill on time. You can buy a MacBook Pro with a Bank of America card, default on your credit card bill, and Apple still gets paid for the MacBook Pro. That's why the money is "credit". So defaulting on your Bank of America payments doesn't make your Apple ID shut down, there's no connection. If merchants didn't get their money from credit cards, then they would stop accepting credit cards. (Merchants are already pissed about the high fees charged by the cards.)

This situation with the Apple Card is weird because the merchant and the credit card company are more or less the same company. It turns out, this is very problematic.

> That's not what happened though. His credit card didn't expire

I didn't say that's what happened. I'm saying it's entirely possible Apple can shutdown your account for owing money even if you don't have an Apple Card.

I had an iTunes account back in 2012 linked to my Paypal. One time I accidentally unlinked my Paypal and Apple wouldn't let me access my iCloud email unless I typed my password. When I typed in my password, it would ask me to verify my CC/Paypal details. When I clicked cancel, the entire process would just happen again.

> Apple can shutdown your account for owing money

Owing money to whom is the question.

Apple can't shut down your account for owing money to Bank of America. Or for owing money to Goldman Sachs for a credit card not associated with Apple. In the case of Apple Card, who is the money owed to, Apple or Goldman Sachs? The latter is supposed to be the bank.

Neither is relevant. The account was shut down because it owed Apple Retail money and they weren’t able to collect on its payment method on file, regardless of what that payment method was.

> Owing money to whom is the question.

Today I can put an App Store charge on my Chase card and do a chargeback making up some stupid reason that I never got my app in which the chargeback would be successful. It's not entirely out of the question that Apple would lock my account until that charge is resolved.

Similarly, Dustin could have used a Chase card to buy the M1 Mac, supposedly "tradein" without sending the device back, Apple erroneously crediting that CC, and then Apple locking down the account until that's resolved.

Both situations result in owing Apple and both are totally plausible situations.

> Today I can put an App Store charge on my Chase card and do a chargeback making up some stupid reason that I never got my app in which the chargeback would be successful. It's not entirely out of the question that Apple would lock my account until that charge is resolved.

Yes, we're all aware of chargebacks, and nobody is disputing that you would owe Apple in that situation. Not sure how this really helps the argument.

The issue here is that the Apple Card seems to completely obliterate any separation between the merchant and the bank, which is obviously problematic. In fact there are 3 different things that you would expect to have some separation: the hardware (MacBook Pro), the services (iCloud), and the credit card. But now all 3 are the same, so buying the hardware with the credit card causes the service to be shut down.

Whereas if the hardware were Dell, the service was Google, and the credit card was Chase, then this problem wouldn't exist, and it would merely be an issue between Chase and the card holder, not affecting the Google services at all.

Chargeback is to establish that Apple can shutdown your services if Apple thinks you owe them money.

Dustin was erroneously credited for something from Apple, and now Apple shutdown his account because they want the money back. This would have happened if it was a Chase card which would prove this statement wrong (which is my whole point):

" the main issue is that Apple shut down his other Apple services because of non-payment. This presumably wouldn't happen if the charge was on a non-Apple card."

> Making this situation sound like this would have never happened if Dustin used a Chase card would be not true.

It is true! If Dustin missed a Chase payment, it has no effect on any of these other things. The iCloud account was paid up already, it wasn't late.

Wrong.

If Dustin used a Chase card for the trade in/payment for the Mac, this situation would have resulted in the exact same way.

> If Dustin used a Chase card for the trade in/payment for the Mac, this situation would have resulted in the exact same way.

How so? Apple charges the Chase card, Chase pays Apple, end of story as far as Apple is concerned, Apple gets its money.

I think you missed the point where Dustin mentioned this:

"Very soon after, it seems that Apple simply added the amount of the credit I received when I purchased the M1 MacBook Pro to my Apple Card balance."

Timeline is as follows: Dustin bought the MacBook in mid January, he mentioned he never received a trade in kit after 2 weeks, then received a reminder in mid-February to send the item in, and "soon after" received credit on his Apple Card. This tells me Apple refunded a portion of the M1 purchase to the credit card erroneously. This can happen with any credit card, not just Apple Card.

As I've already established, if Apple thinks you owe them any amount of cash, they'll lock your account. In this case, Apple thinks Dustin owes them money because Apple accidentally refunded a portion of the M1 purchase.

That's not exactly what happened. "they give you a credit at purchase time" https://twitter.com/dcurtis/status/1366579549610381320

What happened is that when Apple did not receive the trade-in, they added a charge to the card for the amount of the credit.

Anyway, the important point you're missing is that if Apple was dealing with a Chase card, Apple would not be out any money, because Chase pays Apple for any charges to the card. You're conceiving of a scenario where Apple doesn't get all of its money, and that's simply not the case with a third-party credit card.

Now if Apple and Goldman Sachs operated in the same manner, then Apple would also get all of the money it was owed, from Goldman Sachs, and then it would be up to Goldman Sachs to get payment from Dustin, which is no concern of Apple's. But apparently Apple and Goldman Sachs have a different kind of relationship with the Apple Card.

It appears that Apple is using its iCloud leverage to force the card holder to pay Goldman Sachs. Apple would have no such leverage to force the card holder to pay Chase, nor would Apple have any desire to use such leverage for Chase, because Apple is not "in bed", so to speak, with Chase.

> if Apple was dealing with a Chase card, Apple would not be out any money, because Chase pays Apple for any charges to the card

Unsubstantiated statements like this suggest you do not understand how card authorization and liability work for merchants, and it doesn’t seem like you’re interested in finding out.

> That's not exactly what happened. "they give you a credit at purchase time"

That would still be a refund on the Apple Card. "amount of the credit [...] to my Apple Card balance." means Apple refunded a portion of the balance.

> Anyway, the important point you're missing is that if Apple was dealing with a Chase card, Apple would not be out any money

They sure would if they accidentally credited your Chase card. Apple's site says

"Once we receive it, we’ll inspect it and verify its condition. If everything checks out, we’ll credit your original purchase method and send you any remaining balance on an Apple Gift Card by Email."

If they erroneously "credit your original purchase method", they would, in fact, be out of money. Dustin was erroneously credited. I don't see how it would be any different, other than it seems Dustin got his credit instantly, if his tweets were accurate.

If they instantly credited me and I sent them a lump of coal in the trade in, they would be, in effect, out of money, regardless if it was an Apple Card or a Chase card.

After looking into it more, I see that the instant credit system is the culprit.

1. Apple instantly gave Dustin the credit (because he opted into paying monthly). From Apple's site: "If you pay monthly: We’ll apply the value as an instant credit to lower your monthly payments."

2. Apple failed to send the box

3. Apple tried to get its credit back by charging the value to the Apple Card

4. Dustin didn't update the bank info, so Apple couldn't get its money back as the card denied the charge.

5. Apple's fraud alarm went off.

Apple gives you instant trade in credit if you pay monthly. While that's unique to the Apple Card here in USA, other countries that don't have Apple Card offer financing too. It's not out of the question that instant trade in credit is offered to countries that don't have Apple Card but also offer financing on Macbooks too.

Everyone is at fault it seems (more on Apple than Dustin). Dustin failed to update the bank info, Apple failed to send the box, and Apple failed to communicate properly.

I did the same with the Apple Watch. I bought my last Apple Watch using monthly payments, so I got instant trade in credits. I was sent a trade in box, but my cousin wanted to buy the Watch off of me so I never sent in the trade in. Apple simply charged the trade in credit on my card after not receiving the trade in.

Problem solved.

Looks like I was right. Entirely unrelated to the Apple Card. https://9to5mac.com/2021/03/03/apple-card-apple-id-unrelated...

"No matter what payment method was used, the ability to transact on the associated Apple ID was disabled because Apple could not collect funds. This is entirely unrelated to Apple Card."

No. An auth can fail for regular cards as well, especially in a case like this when the auth was placed almost two months before the attempted charges. Most auth holds are only valid for a week or so.

In your BofA card, the credit card could decline the charge if it put the holder over their credit limit. For all we know, that might be why the Apple Card charge was declined.

>In your BofA card, the credit card could decline the charge if it put the holder over their credit limit.

Yes, but when charges are declined, merchants don't ship the products.

This is a weird case, because it was a retroactive charge not explicitly authorized by the card holder. That kind of thing rarely happens.

> For all we know, that might be why the Apple Card charge was declined.

What do you mean "For all we know"? The whole thing was explained in the article, we know exactly what happened.

> This is a weird case, because it was a retroactive charge not explicitly authorized by the card holder. That kind of thing rarely happens

And that is a feature of the trade-in buy flow and not how the purchaser chose to pay. Which is my point exactly which you have been trying to dispute.

> The whole thing was explained in the article, we know exactly what happened.

No we don’t. The article simply says their balance was not being paid. It’s possible that the trade in charge put them over their credit limit and that’s why it was declined. They never confirm otherwise.

> The article simply says their balance was not being paid. It’s possible that the trade in charge put them over their credit limit and that’s why it was declined. They never confirm otherwise.

It's all spelled out very clearly: "As it turns out, my bank account number changed in January, causing Apple Card autopay to fail. Then the Apple Store made a charge on the card."

His Apple Card was paid from his bank account. His bank account changed. He failed to update the bank info. Simple as that, no mystery whatsoever.

If my auto pay information changed for my Apple Card today and became invalid, I would still be able to charge my card a year from today because I have no outstanding balance to pay. Failure to have valid auto pay is necessary but not sufficient.

In addition, you still seem to overlook the fact that every other credit card on the market can also fail to post a transaction even if it authorizes, given sufficient time between the two events.

> you still seem to overlook the fact that every other credit card on the market can also fail to post a transaction even if it authorizes, given sufficient time between the two events.

I don't even know what you're talking about. The transaction was posted. And then the transaction was billed to the card holder. The credit card bill didn't get paid, because the autopay had the wrong bank info. And that's when all the problems occurred. Again, this was all spelled out in the article.

There was no authorization failure. This was a simple case of a missed credit card payment.

The post simply does not have enough information to distinguish between:

Apple Retail in mid-February decided to authorize a charge for the difference and reached out to me when the charge did not post.

and

Apple Retail decided to force me to resolve my credit card balance because I was revolving.

In both cases, Dustin would see a transaction appear on his card transaction history before the merchant learns that the payment won’t post. In your terminology, pending and posted transactions can both be “billed” but they are very different for the merchant in terms of liability.

Furthermore, credit cards aren’t an unregulated Wild West. A minimum payment must be delinquent for 90 days before banks can start moving towards collections. Goldman Sachs is not cavalier enough to risk having the state of New York investigating their bank over a very creative definition of what isn’t collections. In addition, Apple Card offered extremely generous payment terms during the pandemic - there is no reason to believe they’d start aggressively collecting now.

In addition, if the email from Apple was about collections on a credit card, it is required to have a host of disclosures before the contents which are not present in the complete excerpt posted on the blog. Even more evidence that this action had nothing to do with the credit card balance.

Finally, a poster reported the same experience with a PayPal payment method gone bad.

There is no reason to believe this issue stemmed from Apple strong-arming people into paying off their Apple Card revolving credit balance.

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