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Credit Card Scams
- Targeting Those With Poor Credit

Before we discuss obtaining a credit card we need to discuss the scams that credit card seekers may become exposed to. The two best way to prevent being taken advantage of is to heed the caveat, "if it sounds to good to be true, it probably is", and, educate yourself on credit card issues.

If you, like so many of us, have received credit card offers in the mail or email that promise you have been approved for an unsecured credit card with a high credit line, you should be looking for the very fine print. These offers say you have been approved for a $2,500 limit on a credit card account, regardless of your credit, and that you will receive a Visa or MasterCard. 

To receive this offer you are asked to pay a $149.95 dollar fee for the offer by either letting the company debit your current bank account, or by adding the amount to the account of the card you will receive. When the package of materials arrives you will finally discover how restrictive the terms of the offer are. Instead of the credit card you will receive a catalog with what is known as a 'single use' credit card that is only valid for the purchase of materials from the catalog. Along with the materials, you are informed that you will only receive an application for a major credit card after you have purchased $400 dollars of merchandise from the catalog. The cash advance they promoted as a benefit of the card program has a limit of $10 dollars, and cannot be used at any ATM machines.

Once you have made the requisite $400 dollar purchase for extremely overpriced, low quality goods, you receive a form to request a credit card from Visa or MasterCard. The application is one that is widely available, and requires a good credit history just as any other consumer who would apply.

Credit Card Scams 
- Targeting The Poor And Elderly

There is a similar scam that targets people with the same profile. People who rely on Social Security or fixed incomes for support, are contacted by telemarketers presenting an offer that seems to good to be true. The offer is for a pre-approved low interest debt consolidation loan or a low interest rate credit card.

These marketers offer a very low rate, which is supposedly guaranteed for five years. All you need to do to receive the deal is pay a fee of anywhere from $199 and $499 dollars. The sales pitch includes a 'calculated savings chart' that assures your annual savings will more than cover the activation fee.

Furthermore, you are told, this company will process all of the paperwork for you and that, since they offer an absolute customer satisfaction money-back guarantee, there is no risk. If the telemarketer has managed to convince the unwitting consumer, the activation fee will be debited from the customer's bank account with an electronic transfer, and they will be sent a list of ten to fifteen institutions that you could apply to for loans or credit cards on your own. One such telemarketing group defrauded over 2.2 million dollars before being arrested and sentenced to 12 years in prison.

Authorities warn that there are numerous such telemarketing groups in every major city and each one has several offices they switch between every few months to avoid detection and possible prosecution. 

Credit Card Scams 
- Targeting Other Types Of Dubious Techniques.

Some companies will advertise low rates to get you to transfer any balances to their credit card at a rate that is unbelievably low. Be sure you know however, exactly what the terms of the offer are. Often the special rate may be for future purchases, but not the transferred balances or vice-versa. In any case you could end up with a worse total interest rate than you had before the transfer.

Some of these offers are simply a ruse to obtain your credit card information or other personal data that will allow them to access your financial information or spend money from your accounts.

Credit Card Scams
- Credit Card Reviews
Consumers should be aware that all of those credit card offers they receive in the mail box can lower their credit score even if they don't accept any of them. Credit bureaus don't distinguish between inquires made by companies searching for new customers to whom they can market their products, and a person who is in financial trouble and who is applying for more credit cards from those companies.

A person should monitor their credit report and have any credit inquiries unrelated to the application of credit removed and carefully scrutinize suspicious bills, statements, and transactions on their report.

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