David Lerner Associates: How to Spot Signs of a Credit Card Fraud Offer
When Target disclosed in early December that up to 40 million of its customers’ credit and debit cards may have been compromised in a security breach, this set off alarm bells among millions of consumers at the worst possible time: right in the heart of the Christmas shopping season. Many consumers were worried that their stolen credit and debit card information — card numbers, expiration dates and three-digit security codes — could be used by thieves to make unauthorized purchases that they might be liable for.
This major data security breach brought the topic of credit and debit card fraud front and center. But this type of fraud isn’t limited to just the theft of sensitive data from cards. Another type of fraud involves bogus offers for new credit cards that are really attempts to get you to hand over sensitive personal information, or to sell you an over-priced card. These offers usually come via the telephone or email.
Here are 5 warning signs to watch out for to help you spot fraudulent credit card offers:
1. Promises of a credit card despite your credit history. If an offer says you can obtain a credit card even with a poor credit history, this should be a major red flag. Legitimate credit card issuers usually will not make such a claim. Instead, they often require individuals with poor credit to place a deposit in an account at the issuing bank — this is known as a secured credit card. If you are delinquent on your payment, the issuer will then withdraw the amount of money you owe from the bank account.
2. Promises to repair your credit history so you can obtain a card. For a large upfront fee, these scammers claim to be able to repair bad credit, which will supposedly enable you to get a new credit card. Such offers are usually questionable, at best. If there is any inaccurate information in your credit report, you can fix this yourself for free. If the poor credit information is accurate, it cannot be erased or deleted by anyone.
3. Promises of a Gold or Silver card. Fraudulent credit card offers sometimes include a promise that you can receive a Gold or Silver card regardless of your credit history. Often, this turns out to be a card that is gold or silver in color, but can only be used to buy overpriced merchandise from a restrictive catalog or website.
4. A request for fees upfront. It is illegal for telemarketers to charge fees in advance in exchange for a claim to help you get a credit card. Banks, meanwhile, will rarely ask for any money upfront for a credit card (unless it’s a secured card, as described above). If there is an annual fee for the card, this usually appears on the first statement and is due with your first payment.
5. A suspicious looking email. Almost everyone has received a so-called “phishing” email at one time or another, supposedly from a well-known financial institution, usually asking them to go to a website and enter personal information. Similar emails are being used to make fraudulent credit card offers, with the real goal of stealing your personal information.
Some of them are quite sophisticated, with real-looking logos and legitimate-sounding offers. Use caution before you enter any personal information in to website linked from an email solicitation.
Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities. Member FINRA & SIPC.
Founded in 1976, David Lerner Associates is a privately-held broker/dealer with headquarters in Syosset, New York and branch offices in Westport, CT; Boca Raton, FL; Teaneck and Princeton, NJ; and White Plains, NY. For more information contact David Lerner Associates 1 877 367 5960 http://www.davidlerner.com