Related topics: banking, credit score, credit reports, credit cards, financial privacy
Con artists love credit cards.
They snatch receipts, peep personal identification numbers, dive through Dumpsters and share information over the Internet.
Scammers are creative. They'll take an old con and give it a new twist. Some go high-tech, employing texting, cameras or software.Others embrace the old ways, using nothing but an angle and a telephone.
And some of their cons break the hearts of even the most experienced investigators. Disabled people are robbed of benefits; working families get wiped out, left with nothing but debt.
But with a little advance notice -- something most victims don't have -- you can sidestep the con men. Here are nine popular credit card scams, with clues on how you can recognize them before it's too late:
1. We can lower your rate!
The caller gives you the good news: You can get a lower interest rate on your card. The basic premise: For an upfront charge, sometimes as much as $500, the caller promises a deal, says Susan Choe, a section chief with the Ohio Attorney General's Office. And you can simply put the fee on your card.
They can deliver, they say, because they have the right contacts or a special relationship with the card issuer. They may even claim to be from "card member services," "card services" or "cardholder services," Choe says.
Consumers who agree are charged the upfront fee, but those making the promises "failed to deliver," she says. The state is putting the word out to consumers: "Please don't pay someone hundreds of dollars for something you can do yourself," says Choe.
In some cases, it's a ruse to collect your financial information. In others, it may be an actual business that's simply charging a huge fee for something you could do yourself, she says.
Signs the call is not what you think: If this is truly a division of the issuer, you won't have to pay a fee to get a lower rate. If this is a legitimate outside company, it can't do anything you can't already do for free, says Choe. And beware if the word "guarantee" gets thrown out, she says. No one can guarantee you a lower rate. Another clue: The first contact may come through a robo-call, which is illegal.
2. The fake freeze
You get an "emergency" text: There's a problem with your account. Your card has been frozen, and you need to call a provided number. When you phone, you're prompted to enter your card number and other information. What's really going on: Crooks are collecting information so they can use the card. This one is especially heartbreaking when criminals target people receiving disability benefits that are loaded onto cards, says Choe.
How to avoid it: Never use phone numbers or contact information that someone gives you in an email, text or phone call. Instead, look up the card contact information yourself (from a monthly statement, on the back of the card, etc.) Then call and find out what's really going on.
3. The three-digit con
You get a call from your credit card's issuing bank. There have been some problems with security, or they've noticed unusual charges. They need to confirm your information.
The real purpose of the call: to get the three-digit security number on the back of the card. "That's what they're really after," says Steven Weisman, a law professor at Bentley University and the author of "The Truth About Avoiding Scams."
They may even have some of your data already - which means they've bought some of your information online, gone Dumpster diving or picked up one of your old receipts.
The clue to a con: "When they're asking you for information, that's always a bad sign," says Weisman.
4. 'Free games! Free music! Free porn!'
You're online and find free music, games or porn.
But that download could come with a keystroke logger. That's a malicious little piece of software that will note your passwords and other information (such as card numbers), and send them back to the scam artist, says Weisman.
How to protect yourself: Keep your security program updated. "It has to be done automatically and regularly," he says.
Also, just as in the real world, avoid sketchy cyberlocations. "There's not much of a fear of this with legitimate websites," Weisman says. "Downloading free music or free games is like waving a red flag."
5. 'Come to our spoof site!'
You get an email from your bank, PayPal or your favorite store. There's a problem with your account. There's been a security breach. Or your order's ready. Whatever it is, just click this link to get more information or pay for your order.
It's a scam. And so is the site on the other end of that link.
