Fraudulent credit card offers often target people who are
having credit problems and have not been able to get cards elsewhere. They may
promise to get you a card, but legitimate credit card issuers generally do not
do business with people who have bad credit histories.
Do not fall for promises that you will get a credit card
even if you have bad credit.
Do not pay upfront.
It is against the law for telemarketers to charge any fees
in advance if they guarantee or claim that it is likely that they can help you
get a credit card. This does not apply to banks. If there is an application or
processing fee, it should be very small, not the hundreds of dollars that con
artists request. Any annual fee usually appears on your first credit card
If your credit history is bad, your best bet is to get a
“secured” credit card.
This requires you to place a deposit in an account at the
issuing bank equal to your credit limit. If you do not pay your bill, the bank
will use your deposit to cover it. You may not get interest on the account, but
it is a good way to start rebuilding your credit.
A “gold” or “silver” card may not be what you think.
Sometimes fraudulent credit card offers promise “gold” or
“silver” cards from major card issuers. What you receive – if you get anything
at all – is a gold or silver-colored charge card that can only be used to buy
overpriced goods from the company.
Apply for credit cards directly from the issuers.
It is not necessary to pay another company to help you get a
credit card, nor will it improve your chances of obtaining one.
If you have credit problems, get counseling.
Fraudulent credit card companies may also claim that they
can repair your bad credit for a large upfront fee. But you can correct
inaccurate information in your credit files yourself for free, and no one can
erase negative information that is accurate. Your local Consumer Credit
Counseling Service (CCCS) can provide advice about how to build a good credit
record. CCCS may also be able to make payment plans with your creditors if you
have fallen behind. These services are offered for free or at a very low cost.
To find the nearest CCCS office, call toll-free, 800-388-2227, or go to www.nfcc.org.
Protecting your cards
If your credit card is lost or stolen, it can certainly be
inconvenient. But beware of crooks that use scare tactics and false information
to sell protection that consumers do not need.
Worthless credit card loss protection offers are popular
among fraudulent promoters who are trying to exploit unsure consumers. Avoid
doing business with callers who claim that:
You are liable for more than $50 in unauthorized charges on your credit card account.
You need credit card loss protection because computer hackers can access your credit card number and charge thousands of dollars to your account.
A computer bug could make it easy for thieves to place unauthorized charges on your credit card account.
They are from “the security department” and want to activate
the protection feature on your credit card.
Telephone scam artists are lying to get people to buy
worthless credit card loss protection and insurance programs. If you did not
authorize a charge, do not pay it. Follow your credit card issuer’s procedures
for disputing charges you have not authorized. Your liability for unauthorized
charges is limited to $50.
Your credit card issuer may offer extra protection for free
Most card issuers have voluntary policies to remove
unauthorized charges completely if consumers report them as soon as they
discover them. Ask if you are not sure what your issuer’s policy is.
Credit card loss
Your maximum liability under federal law for unauthorized
use of your credit card is $50. If you report the loss before your credit cards
are used, the Fair Credit Billing Act (FCBA) says the card issuer cannot hold
you responsible for any unauthorized charges. If unauthorized charges occur on
your cards before you report them missing, the most you will owe is $50 per
Also, if the loss involves your credit card number, but not
the card itself, you have no liability for unauthorized use.
After the loss, review your billing statements carefully. If
they show any unauthorized charges, it is best to send a letter to the card
issuer describing each questionable charge.
Again, tell the card issuer the date your card was lost or
stolen, or when you first noticed unauthorized charges, and when you first
reported the problem to them. Be sure to send the letter to the address
provided for billing errors. Do not send it with a payment or to the address
where you send your payments unless you are directed to do so.
Watch out for impostors.
Someone may claim to be connected with your credit card
issuer and ask to “verify” your account number to make sure you are protected.
Your real credit card issuer does not need your account number; it already has