Scam Alert about Offers to Help You Handle Credit Card Debt

Few people would turn down the legitimate opportunity to lower the interest rates charged by their credit card issuers, but often, companies who claim they can negotiate significantly lower interest rates for a small, up-front fee are anything but legitimate. Many times, these offers are extended by scam artists via robocalls.
 
"Arkansans who get these interest rate reduction robocalls should listen to them with extreme skepticism, and, better yet, delete them. Many are scams," said Attorney General Dustin McDaniel. For that reason, McDaniel issued this Consumer Alert today.

For anyone who has received such calls, the following will sound familiar: The companies behind the sales pitches say they have special relationships with credit card issuers. They guarantee that the reduced rates they offer will save credit card holders thousands of dollars in interest and finance charges, and will allow them to pay off credit card debt three to five times faster. They claim that the lower interest rates are available for a limited time, so consumers need to act "now." Some even use money-back guarantees to further entice consumers.
 
The Federal Trade Commission says that the companies behind these robocalls can't do anything for you that you can't do for yourself -- for free. Consumers hold as much clout with their credit card issuers as these companies do. What's more, these companies are just as likely as individuals are to get turned down for a rate reduction regardless of their promises or supposed efforts to negotiate. In fact, investigators at the Federal Trade Commission have found that people who pay for these services don't get the touted interest rate reductions, don't save the promised amounts, don't pay off their credit card debt three to five times faster, and struggle to get refunds.
 
If you respond or are tempted to respond to one of these robocalls, remember:

• Don't give out your credit card information. Once a scammer has your data, they can charge your credit card for their own purchases or sell the information to other scammers.
• Don't share other personal financial or sensitive information like your bank account or Social Security numbers. Scam artists often ask for this information during an unsolicited sales pitch, and then use it to commit other frauds against you.
• If the caller suggests or implies that the call and the offer are coming from your current credit card issuer, be suspicious. Do not share any information with the caller. Contact you credit card issuer independently to inquire regarding the availability of a reduced interest rate on your card
• Be skeptical of any unsolicited sales calls that are prerecorded, especially if your phone number is on the National Do Not Call Registry. You shouldn't get recorded sales pitches unless you have specifically agreed to accept such calls from the caller.
• If you engage the caller in conversation, and you are able to obtain any information about the caller, you may wish to report that information to the Office of the Attorney General to assist in its ongoing robocall enforcement efforts.
• To report violations of the National Do Not Call Registry or to register your phone number, click here or call 1-888-382-1222.
  

Federal Trade Commission rules prohibit companies that sell relief services like these rate reduction scams on the phone from charging a fee before they settle or reduce an individual's debt. If you decide to do business with a debt relief company, however, you may be required to put money in a dedicated bank account, which will be administered by an independent third party. The account administrator may charge you a reasonable fee, and is responsible for transferring funds from your account to pay your creditors and the debt settlement company when settlements occur.
 
The most important thing to know is that consumers who are hoping to reduce the interest rate they are paying on credit card purchases are better off handling it themselves. How? Call the customer service phone number on the back of your credit card and ask for a reduced rate. Be calm, patient and persistent.
 
If you think you've experienced a credit card interest rate reduction scam, file a complaint with the Federal Trade Commission (click here) or call toll-free, (877) 382-4357.
 
If your credit card has been charged for a service you didn't order, authorize or receive, and you can't get a refund, dispute the transaction with your credit card company. First, call and try to stop the payment, then follow up in writing. Under the Fair Credit Billing Act, you have the right to dispute charges for any service you didn't get or any transaction you didn't authorize. Visit ftc.gov/credit for more information.
 
You may also contact the Attorney General's Consumer Protection Division at (501) 682-2341, (800) 482-8982 or visit his website (click here).