Last Updated Jun 22, 2010 9:55 PM EDT
I decided to call my credit card issuer. I explained what happened and asked if I needed to put some sort of warning on my account. The representative assured me it wasn't necessary. He was very familiar with this scam and explained that I'm the only person who can cancel my credit card. (Well, except the bank itself, but that's a different issue.)
What the fraudsters really wanted was to sell me a worthless and expensive debt reduction service. Here's how the scam plays out, according to the FTC:
"The companies behind the sales pitches claim to have special relationships with credit card issuers. They guarantee that the reduced rates they offer will save you thousands of dollars in interest and finance charges, and will allow you to pay off your credit card debt three to five times faster. They claim that the lower interest rates are available for a limited time and that you need to act now. Some even use money-back guarantees as further enticement."
What these fraudulent companies are actually doing is charging a hefty fee to negotiate with your credit card issuer on your behalf to get you a lower interest rate.
The FTC investigators, however, found that consumers "don't get the touted interest rate reductions, don't save the promised amounts, don't pay off their credit card debt three to five times faster, and struggle to get refunds."
So what about all that personal information the scam artist had on me? Most of that data is probably available on the web for everyone to see. And since I didn't give the caller my bank or credit card account information or my social security number, I'm probably fine.
As we all know, scams come and go. But often the mechanisms for how these companies find their next victims stay the same. So keep this in mind the next time you get an automated robocall offering you some service that sounds too good to be true:
- First, sales oriented robocalls are illegal (and have been since September 1, 2009) unless the seller has your written permission to contact you.
- These companies are not allowed to dial your number if you are on the Do Not Call Registry. If you haven't already done so, click here to add your name to the list.
- It's also illegal for a company to keep calling you if you've requested not be contacted again.
Credit Cards image by Andres Rueda, courtesy CC 2.0.
Stacey Bradford is the author of The Wall Street Journal. Financial Guidebook for New Parents.