This looks fine for me (I have shorten it some), what system are you on?
awk -F, -vOFS=, '$3 ~/^"AB/{$2="\"foo\""}1' input.dat
"5000","foo","AB8989"
"3000","foo","AB7676"
"2000"," ","A07444"
"4000"," ","BN0909"
PS I added double quotes to "foo"