Unknown Credit Card Charges: Fraud or Legit?

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Recently, my mother-in-law discovered that a pretty significant piece of jewelry had gone missing. There had been a number of construction workers in the house for a few weeks and when she went to get her jewelry, it was gone. After searching like a crazy person under/in/on top of everything, she called the police.

When the police arrived they asked a bunch of questions, did an onsite investigation and calmly and collectively stated to her: “You misplaced it. It probably hasn’t been stolen. You will find it in a few days.”

Visibly upset and a little teary eyed, she thanked the officer for his time and collapsed in her chair. Two days later, as she was folding laundry, there it was, nestled with her undergarments. She swears to this day she didn’t put it there, but it must have fallen into the drawer from the top of the dresser on a day she was putting laundry away.

Frankly, minus the calling the police, I’ve done the exact same thing.

When charges are made to our credit cards, it’s very easy to look at a charge, not be familiar with it and immediately suspect fraud. Each month, I reconcile my statements at least twice—first weekly when current charges are made and then when my final statement comes in. And without fail, there is at least one charge that gets me all in a tizzy and requires me to do my own investigation.

When you come across one of those questionable charges (and you will), don’t panic until you take these steps.

#1: Look up the name of the company online. Generally you will find something that will immediately trigger your memory as to what you bought and from whom.

#2: Check your receipts against the dollar amount charged and also look for the company name.

#3: Some merchants include a phone number as part of their merchant information on the receipt. Call the number and be cordial to the person on the phone.

#4: If all else fails, call your credit card company and dispute the charge. You will have to give up some basic information,but the credit card company will get to the bottom of it within two billing cycles.

#5: Sign up for BillGuard for free. BillGuard monitors your credit card charges and alerts you to any potential fraud. If there are any grey charges, BillGuard will flag them and let you know.

Robert Siciliano is a personal security expert & advisor to BillGuard and is the author of 99 Things You Wish You Knew Before Your Identity Was Stolen. See him knock’em dead in this identity theft prevention video. Disclosures.

The Top 6 Sources of Grey Charges

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Those out-of-the-blue credit card charges that sneak up on us and require our time, attention, persistence and aggravation to squelch are called grey charges. Thanks to these insidious leaks, millions of people lose billions of dollars.

Sleazy, scheming merchants have perfected the art of the grey charge by capitalizing on the fact that we don’t payattention to the fine print and often do not pay much attention to our statements, either. But by being aware of these scammy sales techniques, you can prevent getting caught up in a vicious circle of grey charges.

Here are the top six sources of grey charges:

#1 Unknown subscriptions. In the process of checking outduring an online transaction, you might check or uncheck a box in regard to an offer or discount. Either way, a few months later you start getting all these charges for services you never wanted or ordered.

#2 Zombie subscriptions. After you recognize a grey charge for an unknown subscription, you might get the charge removed—only to find out months later it’s back from the dead and you’re being charged again.

#3 Auto-renewals. When signing up for a service that bills you monthly, quarterly or annually, a forthright retailer will let you know when your renewal date is coming and will inform you of upcoming charges. But shady companies don’t say a word and re-charge you without notification, sticking you with the bill even after you complain—all because you were “too late.”

#4 Negative-option marketing. When buying a product, you ultimately buy a suite of services you never wanted.

#5 Free to paid. When getting something “for free”and you have to cough up your credit card, there is always a catch. That catch is usually in the form of ongoing charges that are difficult to remove.

#6 Cost creep. The initial purchase price might have been $9.99 for the first three months, but then it becomes $19.99 a month thereafter. Then the merchant tacks on an annual $99.99 membership fee.Then you want to crawl through the phone and choke someone.

Stay out of trouble by keeping these tips in mind:

  • Pay attention. Nothing is free.
  • Monitor your purchases. Know what you’re getting into.
  • Check statements biweekly. Look for grey charges
  • Sign up for BillGuard to watch your statements. It’s free, easy and effective.

Robert Siciliano is a personal security expert & advisor to BillGuard and is the author of 99 Things You Wish You Knew Before Your Identity Was Stolen. See him knock’em dead in this identity theft prevention video. Disclosures.

Grey Charges Are Upsetting—and Legal

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Disclosure notices on websites, advertisements and in the terms of an agreement when making a product purchase are often complicated and confusing. Companies know this and take advantage of consumers, figuring potential purchasers don’t have the time, inclination or knowledge of the legalese that goes along with the fine print. Embedded deeply in the disclosure is the exact nature of credit card charges—and really, has anyone ever read that? My best guestimate is that 95 percent of the population hasn’t, which is why 95 percent of unwanted credit card charges are considered “grey charges.”

Because the legalese spells it all out (and trusting consumers sign on the dotted line),grey charges are not illegal—which by default makes them legal. However you slice it, I’m sure we can all agree that grey charges are upsetting, sleazy, sneaky and deceptive. More than once I’ve yelled and screamed at a customer service representative who gave me a million reasons under the sun as to why I wasn’t entitled to a reversed charge on my credit card. Grey charges cost more than time and money; they also cost users personally through the very expensive commodity of emotional bandwidth.

Companies exercising their grey charge rights (however wrong they may seem to the rest of us) are well-known legal entities that many of us do business with every day. They make billions of dollars confusing and deceiving customers into paying, and consumers are mostly uninformed—until now.

Companies engaged in this behavior know levying grey charges is legal, but unethical. But when they are making so much money, they aren’t about to stop. Consumers are ultimately responsible for checking their credit card statements and looking for grey charges. But according to BillGuard, few credit card holders—1 in 10—rarely, if ever, look at their statements.

Don’t get taken! Here’s how to outwit the grey chargers:

  • Scrutinize your statements carefully
  • Demand refunds when grey charges occur
  • Threaten a “chargeback,” which is a transaction in which a bank pulls money back out of a merchant’s account
  • Get BillGuard to do all the worrying for you—and get back your peace of mind

Robert Siciliano is a personal security expert & advisor to BillGuard and is the author of 99 Things You Wish You Knew Before Your Identity Was Stolen. See him knock’em dead in this identity theft prevention video. Disclosures.

The Devil is in the Details

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In unwanted credit card charges, the details are the fine print—and the fine print often results in devilish “grey charges.”Grey charges are those credit card charges that appear on your statement from out of the blue, charging us small or large fees—or sometimes a single charge—monthly or annually.

The fine print can sometimes be expensive. And with unwanted credit cards, charges happen when we think we are paying attention or a sleight-of-hand action by a scammy retailer hooks us.

Boldface lies.The fine print may begin with lies. A website might look professionally done, complete with a believable story based on a plausible scenario andphotos representing real people with genuine-sounding comments. But in reality, it’s smoke and mirrors meant to deceive you.

Bogus trial periods.Trial periods with 30-day money-back guarantees are often rife with lies ending in grey charges. The fine print might read, “Delivery time is subtracted from your trial period”—in other words, if the package takes two weeks to get to you, you only have two weeks to try the product. But the clock starts ticking from the moment the package leaves the facility. After thinking you have 30 days from the delivery date, you decide to return the unwanted item—and you learn too late that you are out of time and out of luck.

Twice-bought scams. You buy a product in January, and when you receive it the product is damaged or of poor quality, so you immediately return it and get your money back. Then six months goes by and you see the same ad. You still want the product and figure you’ll give the company a second try; perhapsthey’ll have their act together by now. But when you get the product a second time, it’s just as bad as the first—and in the fine print it says, “We do not honor refunds to customers who have purchased the same product in the past.”

Free trials. Like Mom said, “There is no free lunch” and “If it’s too good to be true, it is.” This applies to free trial periods as well. Often, the upfront cost of the item is just a few dollars. You make the purchase,and the free trial begins the same day you purchased the product—not when you receive it—so themerchant weaves in the bogus trial period. Then, after the free trial period expires, you learn the actual cost of the item might be 10 to 20 times the initial charge.

Outwit the devil by paying attention to the details:

  • Pay attention to the fine print, as hard as that may be
  • Ask as many questions as you need to before laying down your credit card number
  • Use a credit card and not a debit card
  • Watch your statements closely
  • Get BillGuard to watch the grey charges for you

Robert Siciliano is a personal security expert & advisor to BillGuard and is the author of 99 Things You Wish You Knew Before Your Identity Was Stolen. See him knock’em dead in this identity theft prevention video. Disclosures.

Avoid Unwanted Credit Card Charges

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I think it’s safe to say that all credit card charges are unwanted, but today I’m talking about so-called “grey charges”—those out-of-the-blue credit card charges that sneak up on us and require our time, attention, persistence and aggravation to get rid of. A study by BillGuard shows the average dollar amount lost by grey charges is around $356.00per consumer annually.

Studies show 1 in 4 people to be victims of grey charges, and because 9 out of 10 people don’t even check their billing statements or only skim them lookingfor large purchases, those grey charges end up eclipsing fraud—as much as 95 percent grey charges to only 5 percent actual fraud!

While fraud certainly is and will always be a hot-button topic that has consumers scrambling to protect their credit cards (which, in reality, can’t completely be protected; all you can do is pay attention to your statements), grey charges have been absent on consumers’ radars in part because the companies that profit from these charges don’t want you to know about them. Fraud consists of 1 percent goods and services not delivered, 1 percent unauthorized charges and 3 percent “other” fraud, which often consists of hacking or unauthorized charges that occur after you hand your card over to a clerk.

Grey charges occur because 1 percent are billing errors, 2 percent are overcharges, 2 percent are duplicate charges, 4 percent are forgotten charges, 5 percent are hidden fees, 34 percent are just totally unrecognizable charges out of nowhere and a whopping 47 percent are unwanted subscriptions such as recurring memberships, “zombie” subscriptions, unwanted auto-renewals, negative option marketing, and “free to paid” offers.

Here’s how to reduce your risk of grey charges and fraud:

  • Always reconcile your bills diligently and on a timely basis
  • Refute unauthorized charges immediately—within one to two billing cycles
  • Use a credit card instead of a debit card, as credit cards offer more consumer protection
  • Use BillGuard to watch your back and protect you from grey charges

Robert Siciliano is a personal security expert & advisor to BillGuard and is the author of 99 Things You Wish You Knew Before Your Identity Was Stolen. See him knock’em dead in this identity theft prevention video. Disclosures.

BillGuard: Grey Charges Equal Legal Fraud

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Grey charge: When you buy something with your credit card and you get charged for something you didn’t want. Often a merchant will tack on additional products and services to a legitimate purchase you make, and you “sorta” know about the charge…but not really.

For example, you might be in the process of purchasing something and a pop-up windowreading “Get 25 percent off your order NOW! CLICK HERE!” comes up. And in the fine print below “CLICK HERE!” it says, “By getting 25 percent off, you are agreeing to get a free month of a one-year membership to our discount clubfor which you will be charged$19.95 per month after the first month. You may cancel at any time, but you are required to give us 30 days’ notice in writing.”

Or something stupid like that.

Then, a couple of months go by and you get your credit card statement and see this charge for $19.95 and wonder what it’s for. You call the number on the statement and someone answers and puts you on hold for an hour. By the time you are done yelling and pulling all your hair out of your head, you will probably end up gettingcharged for two or three months for something you never wanted.

And that’s IF you even pay attention you your credit card statements, because nine out of 10 people don’t check their bills, or merely skim them quickly for large purchases. This is what the scammy merchant bets on when initiating a grey charge.

Is it legal? Well, it’s not illegal…but it IS sneaky and deceptive.

According to BillGuard’s internal research, one in four users has incurred some type of erroneous or deceptive charge in the last 12 months. And among those users who have been affected, the average of these charges is about $350 a year.

So pay attention to your statements and refute unauthorized or grey charges ASAP. And don’t forget: Read the fine print—and remember that any offer that sounds too good to be true is.

Robert Siciliano is a personal security expert & adviser to BillGuard and is the author of 99 Things You Wish You Knew Before Your Identity Was Stolen. See him knock’em dead in this identity theft prevention video. Disclosures.

Should I Give Them My Data?

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We’ve heard lots and lots about data breaches in the last decade. And with the term “cloud” becoming more prevalent (which, incidentally, just refers to a computer server connected to the internet), people are asking how secure their data is on the various websites they agree to host it.

For example, online banking, online backup, social media, email and the various free services you may subscribe to are cloud-based and house lots of personal information. But are they secure? The answer is, “It depends.”

For example, BillGuard utilizes bank-level 256-bit AES encryption (the same level of encryption approved by the National Security Agency for storing top-secret data) for all communications and data processing; it also is performed on servers isolated from direct access to the Internet. (That additional level of security is also very important.) BillGuard’s systems are monitored by its own security staff 24/7 and audited daily by VeriSign and McAfee Secure, and a company called Security Art performs regular penetration testing to preemptively ward off data intrusion.

Furthermore, BillGuard does not store your credit/debit card account login credentials or ask for any personally identifiable information beyond an email address (for alerts) and your zip code. Not storing your data is good too.

Chances are, your bank uses the same level of security too. Deciding if you should give up your data depends on the potential risk and return. Do you give your credit card number to a waitress for a burger? You probably shouldn’t, but you do. Do you give your Social Security number to an insurance agent for identification on your policy? We pretty much have to hand over our data for services, and if you want to protect the data, we really should hand it over to companies that are in the business of protecting it—as long as they are responsible with it.

So when deciding to “give it up,” I say you should see what security measures these parties have in place and then decide. I’m sure your waitress has it all covered, anyway.J

Robert Siciliano is a personal security expert & adviser to BillGuard and is the author of 99 Things You Wish You Knew Before Your Identity Was Stolen. See him knock’em dead in this identity theft prevention video. Disclosures.

BillGuard is Personal Finance Security

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If I had a dime for every time I’ve been asked, “How do I protect my credit card number?” I’d be living on my own island in the Pacific. My response has always been, “Use your card whenever and wherever and don’t worry about it, but pay close attention to your statements,” because that’s really all you can do. But due to most people not carefully checking their statements, my sage advice has fallen on deaf ears.

The good news is, the agony associated with checking credit and debit card statements from different banks and painstakingly reviewing each charge is as close to being solved as ever. BillGuard, a personal finance security service, analyzes millions of consumer billing complaints to find deceptive and unwanted charges that result from misleading sales and billing practices on your credit and debit card statements all in one place.

All you do is register the cards you want protected by granting BillGuard secure, read-only access to the credit issuer’s website that displays your credit card’s transaction activity. BillGuard then scans your card activity daily, running each transaction through over 100 automated security tests, including checking the web and banks, for complaints about the merchants and charges that appear on your bills and statements. BillGuard identifies hidden charges, billing errors, misleading subscriptions, scams and fraud on your bills and statements and alerts you via email when your attention is required. A scan report email is sent monthly, providing a quick overview of your cards—and, along with it, much-needed peace of mind.

BillGuard provides a beautifully combined view of all your credit and debit cards in one place and makes it easy to understand every charge on your statements. No more painstaking calls to the bank to explain unrecognized charges! BillGuard saves you both money and time, even helping you get your money back when needed.

I’ve been using BillGuard since 2011 and it has alerted me to numerous charges that required my attention. Having a personal finance security company watching my cards (and watching my back), has helped me understand my statements and the various strange charges that most people don’t acknowledge, often resulting in hundreds of dollars lost each year.

Robert Siciliano is a personal security expert & adviser to BillGuard and is the author of 99 Things You Wish You Knew Before Your Identity Was Stolen. See him knock’em dead in this identity theft prevention video. Disclosures.

Do You Really Pay Attention to Your Billing Statements?

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Do you take a close look at all your bills and statements every month? Do you look at all the charges? Are you familiar with each charge—where, when and to whom? Do you recognize monthly recurring charges? Did you know that nine out of 10 people don’t check their bills, or merely skim them quickly for large purchases?

Did you know that by federal law, after 60 days if there is a fraudulent credit card charge or a “grey charge” that you didn’t authorize, you can be held liable and responsible for the charge? Did you know that by federal law it’s only two days where your bank’s debit card is concerned?

Did you know that your bank doesn’t protect you from all credit card fraud or from grey charges? Banks use so-called “anomaly detection software” to seek out charges that might not appear to make sense. For example, if you use your credit card at your local gas station at noon and then 10 minutes later your card’s information is used in Russia, your bank will see that as an anomaly and flag the charge. But banks don’t catch everything, which means that, at some point, you’ve probably paid for stuff you shouldn’t have.

BillGuard—a free service that harnesses our collective vigilance to protect everyone from deceptive and unwanted charges that result from misleading sales and billing practices, such as hidden charges, billing errors, and misleading subscriptions,—estimates the average consumer loses over $300 a year to unwanted charges he or she is not even aware of. Card fraud alone is an $8 billion-a-year crime, with banks catching only a third of it. The rest is up to us as consumers.In contrast BillGuard estimates that grey charges are a much higher dollar amount, simply on the basis that it impacts every consumer.

Every day, tens of thousands of people report bad charges on their credit and debit cards to their banks and merchants. Millions more post their complaints online. Up until now, all that knowledge hasn’t been benefiting the most important person of all—you.

Visit BillGuard and check out your statements online at least every two weeks.

Robert Siciliano is a personal security expert & adviser to BillGuard and is the author of 99 Things You Wish You Knew Before Your Identity Was Stolen. See him knock’em dead in this identity theft prevention video. Disclosures.