So no money is effectively leaving any of my 13 credit/debit card accounts when a merchant does an authorization.
As much as I hate referring to Wikipedia as a source they do explain it pretty clearly: "Authorization hold (also card authorization, preauthorization, or preauth) is the practice within the banking industry of authorizing electronic transactions done with a debit card or credit card and
holding this balance as unavailable either until the merchant clears the transaction (also called settlement), or the hold "falls off." " Just go to wikipedia and do a search for the term "Authorization hold", the sentence above is the first in that article.
You are a prime example of a customer preferring to use PayPal instead of a credit card through our system, that's why we offer it as an option. Perhaps some day enough people will have bad experiences with PayPal that it won't be a necessary option, but for now, people seem to like it.
How would this have been any different had this been a normal credit card process using Authorize.net or some other payment processor besides PayPal? The crux of the mater is in the quoted sentence above: "
until the merchant clears the transaction (also called settlement)". LP placed a hold on my available funds then charged two more transactions
in addition and left the original hold to simply just "fall off" by itself eventually, thereby taking the money for the items ordered and preventing me from using the funds on hold due to the authorization for several days until the hold expired. I do not see how this process initiated by LP would have made the outcome go any differently whether it went through PayPal, Authorize.net, Stripe, Amazon, Google Checkout, or any other service.
[Edit: Wells Fargo explains this concept here as well: "An authorization is an approval on a cardholder account for a sale amount. An authorization hold is a
reduction of the cardholder's credit line for the amount of the sale. This hold can remain on the cardholder's account for up to 30 days, depending upon the issuing bank policy." -
Source ] (Presumably until the merchant "settles" the transaction as described in the Wikipedia article above.)
Wells Fargo continues to say: "When you're conducting a transaction and you need an authorization, remember that the authorization must be for the identical sale amount. If you receive an authorization for the wrong amount, delete the incorrect authorization, and re-authorize for the exact dollar amount", so LP should have cancelled the hold on my account (releasing the funds) when they decided to split the order into two shipments, and placed two new independent holds for the smaller individual amounts which each should have been "settled" themselves, or LP should have just gone ahead and "settled" the full amount from the get go, marked the order as paid, and shipped the items however they wanted to, one box or two).
I am not drawing any more pictures for anyone about this. Surely this is something simple to understand by this point?!