Security experts and credit industry representatives are warning cardholders against trusting fraudulent scam artists with their credit cards. Analysts say that the current economic environment is making more and more American consumers on the edge regarding their finances. As a result, more cardholders are on the lookout for credit debt reduction services. This is where scammers come in and prey on the vulnerability of consumers needing assistance with their mounting debts.
Because more people are eager to have their debts reduced, bogus companies have started targeting helpless cardholders who are unaware of the dangers they may be in. Recent media reports from across the U.S. suggest a sudden spike in the number of credit card fraud cases. Some of these incidents involve telemarketing scams, with scammers posing as card company representatives or debt reduction agents offering to help cardholders desperate for any form of assistance.
Analysts say that more and more Americans have fallen victim to these telemarketing scams. Representatives would often call random cardholders and offer lower interest rates to entice consumers into providing important information regarding their credit cards. Some scammers would even offer to negotiate with card issuers for lower rates or debt reduction on behalf of the cardholders. The trademark of these fraudsters, experts say, is that they require a up-front payments from the consumers. Security analysts warn consumers against revealing important information that may compromise the security of their credit cards. This can include anything from the cardholders' social security numbers, financial information, and their card numbers.
Several bogus credit repair companies would even advise cardholders to stop sending payments to their card issuers and instead forward their payments to the scam artists. Experts say that unless the card companies acknowledge any relationship with these service companies, cardholders would do well to stay clear of these fraudulent companies. Following the advice of these scam artists can only mean exposing consumers to increased risk regarding their credit scores and histories.
There are, however, legitimate debt reduction services. Even so, some of these companies deceive consumers and trick them into paying hefty fees for their services. Worse, the payments are often charged to the cardholders' credit cards, further adding to their financial problems. Experts say that consumers are better off asking help from established non-profit counseling services. These are often accredited by card issuers and have long histories of credit counseling.
Better yet, some analysts suggest getting credit cards with better terms and rates. Cardholders can even consider switching to debit cards without overdraft protection to better manage their finances.