This entry was posted on Saturday, September 12th, 2009 at 12:19 pm and is filed under General Discussion. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
A new scam used by well-established financial services companies seems to be emerging.
1) They take your credit card number supposedly for a one off payment, then keep it to take money off you whenever they feel like it..
2) More is taken from the card than the amount agreed on during the call.
3) They deliberately delay sending out the documents and terms and conditions.
4) Instead they immediately send a letter saying you have authorised to take future funds from the credit card.
5) The letter contains many details — EXCEPT the amount you have agreed to pay.
The Financial Services Authority knows about this, but is doing absolutely nothing to bring these companies into line. Yet we’re only a year since the financial industry was exposed and it is these small things that end up eroding trust and bringing down institutions.
Wake up FSA
One Response to “New Financial Services scam”
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September 12th, 2009 at 1:43 pm
Dear Humphrey,
To get around this problem, I’ve been using Citibank’s “virtual credit card” number service for almost ten years, and it’s saved me thousands of dollars.
When you type a credit card number online, or give one over the phone, the number you give them is a unique number obtained from the Citibank web site. When you obtain the number, you specify the maximum amount that can be charged, and you specify an expiration date. Only one vendor is allowed to charge to that number, and only up to the maximum amount and the specified date.
I really hate to say anything that endorses Citibank, since they’ve conducted a lot of scams of their own, and are still doing so. They’re screwing their own customers by arbitrarily raising interest rates to usurious levels, and then using the money to pay themselves million dollar bonuses.
Nonetheless, they have the only service of this type that I know of. Paypal and DiscoverCard offer similar services, but you can’t specify a maximum amount or a time limit, so those services are almost useless. Only Citibank’s service does it right.
Frankly, I wish some other banks would offer this service, and do it the right way. But until that happens, the Citibank service is the best way to avoid the scam you’re describing.
John J. Xenakis
GenerationalDynamics.com