A long time ago I signed up for a service and wrote the company a pre-authorized withdrawal. A little later the founder of the company ran away to Colombia. Concerned, I went to my bank to tell them to stop paying the withdrawals, and was extremely surprised to be told that they could not do that. I was even more surprised to be told that the bank would actually pay any requests for withdrawals they received, without checking that I had actually signed a pre-authorization.
This was in Canada. In the UK the equivalent process is called a Direct Debit. It has to be set up with the bank and can be cancelled by the account holder at any time.
- Is it true that North American banks will not allow you to stop a pre-authorized payment?
- Is it true that North American banks will pay a request for a pre-authorized withdrawal without checking that an authorization has actually been made?