What does "empty envelope deposit" mean for banks?

Empty Envelope Deposit is just what it says...you say you're depositing money in the ATM, but do not put any money in the envelope. It automatically adds it to your balance then. When the bank takes all the envelopes out and matches the cash to what the report says, then they will debit your account for the amount of your said deposit. If you had withdrawn the money that wasn't in your account, then it will make you negative and then you will be charged a fee. The bank will take their money back when they realize that you made a bogus deposit.

The bank will make a small portion of what u deposited available for immediate withdrawal and if you take money it will bring your account into the negative and you will get a insufficient funds fee. they will try contacting you asking you to make a deposit so they can get money back.