Credit Card Fraud


According to the Bureau of Justice’s statistics, 8.6 million households per year are affected by identity theft. This is a serious problem, but it’s not the only thing you have to watch out for. There are scams out there that are legal as long as the scammers place it in writing what you are paying for, and as long as the scam involves no actual theft of information. Sure scammers will be happy to steal your social security number or your credit card number, but sometimes they simply try to sell you something that ends up being a whole bunch of nothing.

By advertising on the internet to people who have recently searched for credit or sources of credit, or by finding lists of people who have recently gone bankrupt, scammers aim their efforts at people who already have bad credit or are down on their luck. The perpetrators of these credit card based scams try to find individuals who seem desperate for credit.

Victims are identified and lured in during searches for new credit. They are located by the perpetrator when they click on pop-up ads.

Once a criminal has the necessary information to identify a victim there are a couple of ways that the scams are orchestrated.  The victim is informed that they can receive a “gold card” that has a huge credit limit. But they are required to pay extensive fees for the card.   Additionally the cards are only good for purchasing exorbitantly priced merchandise from the scammers.

Another other popular trick is for the scammers to advertise that they will help find a credit card that has easy approval.  They charge a fee for this “service,” and it only sends the victim to a list of major credit card companies or worse, a list of cards that are just “gold card” scams from the scammers!

This last scam is often used by both legitimate and illegitimate businesses to get customers, but either way this isn’t the most honest business practice. This scam comes in the form of “free trial offers.” A company, legitimate or not, will advertise a free trial offer of their product. This is usually a product that will interest you, because they target customers based on their internet searches. You sign up for the free trial offer, but what they fail to tell you in the fine print is that you are automatically billed for the product at the end of the free trial if you fail to cancel. In some cases, if they tell you in writing ahead of time, they will even charge you for the product at the end of the trial without giving you the option to cancel.

Sometimes it can be difficult to figure out which credit card offers are legitimate.  There are, however, some easy to spot signs that something is fishy.

The most important warning flag is text in the advertisement that guarantees a credit card or credit approval. Legitimate cards can never guarantee approval until after the credit check is complete.

Another warning sign is a disclaimer that no credit check will be required. Legitimate credit sources must check credit records for approval and rates.

Legitimate businesses will also be unlikely to promise future eligibility for a card, and they will never require a purchase of merchandise from the credit issuer in order to build credit history. Real credit issuers will advise prospects to build a credit history before applying.  Normally this would be recommended by building credit history with current cards or loan repayments.  Positive credit history as a condition for credit approval should be built independently from the potential credit issuer.

Tips to Avoid Credit Card Fraud:

  • Never pay a card application fee. Applying for credit should be completely free, and no legitimate business will charge a customer to apply.
  • Never pay any other fees until credit has been approved.
  • Never provide bank account numbers on a credit card application. Legitimate credit issuers will only need this information after approval.
  • Avoid unsolicited emails; they are the number one way that thieves will try to scam you with card scams.

Tips for Finding Good Lenders:

  • The best way to find legitimate sources of credit is to go to websites for major credit issuers that are well known and safe.
  • Shopping locally for auto loans and other major loans.
  • Instead of answering emails, seek credit opportunities on the web.

Sometimes the best way to tell if a credit card offer is really a scam is to think, “Does this sound too good to be true?” If the answer is yes, it probably is. If you think you have been a victim of a credit scam the first thing to do is contact the Federal Trade Commission. If you are interested in a legitimate auto loan provider, then please be sure to contact Liberty Buick GMC.