How signup tricksters catch their victims: Internet Scambusters #733
Simply answering "yes" in a telephone survey can be enough to catch you out with a signup trick.
It's just one of the ways the scammers, subscription websites and over-eager sales clerks get you to agree to store cards or subscriptions you don't want.
But we'll tell you how to give them the slip in this week's issue.
Now, here we go...
5 Ways to Skip a Signup Trick
Have you ever felt you've been tricked into signing up for a store card, a recurring subscription or some other type of payment you don't recall agreeing to?
During our research, we frequently encounter complaints from consumers about these signup tricks.
We can't always call them out-and-out scams because the perpetrators often tread the thin line between what's legal and what's not.
For example, an increasingly common complaint relates to shoppers being offered a "rewards card" when they make a purchase, in return for an instant discount on whatever they happen to be buying.
But, if there's a discount on an offer, it's usually because what you're signing up for is in fact a store credit card, for which the clerk may earn a commission.
You may not mind this but you deserve to know it's a credit card, not just a rewards card, before signing. Also, whenever you sign up for a store card like this, it will automatically go on your credit record and could affect your credit score (though not necessarily negatively).
Other times, Internet users discover a surprising recurring charge appearing on their credit card account.
This happened recently to a member of the Scambusters team who was seeking contact details for a particular individual (not connected with Scambusters).
He paid $1.99 to one of the many online personal data providers to obtain the person's address and phone number.
The following month, a recurring charge of $19.99 appeared on his credit card for "membership" to the website.
He quickly visited the website and discovered that in setting up his account to get the original information he was seeking, he had become a "member" of the site and was now subject to the charge.
"I couldn't find any reference to how this happened," he says, "but no doubt it was buried somewhere in the small print or the site's Terms & Conditions. Fortunately, it was easy to cancel my membership and stop further charges but I was still $19.99 out of pocket."
Other Internet users have fallen for similar sign-up ruses.
For example, one individual trying to set up an online loan found that he had somehow agreed to a monthly $14.99 payment to a third-party organization that provided information on loans.
"I feel tricked and taken advantage of in a way that must fail proper marketing and regulatory tests," he wrote in an online forum.
Other victims include people who agree to take online surveys and when they click on a "Yes" response to a question, they're also signing up to pay a monthly fee.
This has even happened to people responding to telesales surveys in which victims subsequently discover either unrecognized charges on their phone bill or that they've been switched to another long-distance service provider -- scams known as "cramming" and "slamming" respectively.
A recent news report told how one victim who discovered his service had been switched phoned the new provider to complain. They played back to him an earlier "survey" he had answered in which he could be heard simply grunting "Mmhmm" and, in so doing, seemingly consenting to the switch.
So how can you avoid getting trapped by this type of scam?
Here are 5 important things you must do.
1. Always read the small print, including Terms & Conditions, whenever you sign up for anything, whether it's on paper or online. Yes, this is tedious but it's the only way you can be sure of what you're agreeing to.
2. Look for check boxes that already have a checkmark in them and read what you are effectively signing up for by default. This is an increasingly common tactic. And never click a "yes' box or say "yes" in a phone survey without thinking about what you're agreeing to.
3. If you are dealing with a company or service provider that's new to you, check out the company's reputation online. There are scores of "complaint and grumble" sites where the names of persistent tricksters show up.
4. Use a one-off credit card number (also known as a virtual account number) to pay.
But beware. Some card issuers do allow virtual numbers to be used for recurring payments, but they do allow users to set a maximum ceiling for any payment.
This was something our team member discovered. He had wisely used a one-off credit card number but didn't know it could be used for recurring charges for up to a year by the service he was using.
His credit card company told him later he could have set a low ceiling of $2 on subsequent payments to limit his losses.
5. Watch out for "Reward Card" come-ons in stores. If you're offered a discount for signing up, it's almost certainly going to be for a store credit card. Ask the clerk for a copy of the signup form and then stand to one side to read it thoroughly before signing.
The incidence of these scams is on the rise, so always make sure you regularly check your credit card and phone bills -- both for mobile and landline services, and immediately take action to dispute charges and cancel services.
For more information on how to cancel recurring payments, check out this earlier Scambusters issue, How to Identify and Cancel Troublesome Recurring Payments.
And remember, it's easy to say "yes" in reply to a question but it can be difficult to undo the consequences of saying it. So, think carefully. You could be falling for a signup trick.
Alert of the Week
Around this time of year, it's easy to be tricked into opening an email link or attachment that comes with the words "Order Confirmation."
It's currently the favorite trick of ransomware scammers. One click will lock up your PC and issue a demand for payment of the "ransom" to unlock it.
Most (if not all) genuine retailers send out order confirmation messages that clearly specify what you've ordered and don't require you to click anything.
If you receive a message that doesn't have this information or seems to relate to an order you don't recognize, don't click the link. Visit the retailer's genuine site and check your orders there.
That's all for today -- we'll see you next week.