I guess what @cqg meant with “new cards” are learning cards. If you fail a review card, the lapse counter increases by one. But if you immediately fail it again, the counter won’t increase because it’s a relearning card now. Only after finishing the (re)learning steps will lapses be counted again.
So try setting the threshold to 1 and then rate a review card as Again. There should be a message that the card has been suspended.
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