If you’re paying high interest on credit card balances, you could be a target for the “Rate-reduction” scam artists. These are the folks who call and promise to get your credit card interest rates lowered – for a fee, of course.
One of the most prevalent goes by the name “Easy Financial,” and they’ve been actively marketing their program to unsuspecting consumers.
The calls may come from a live person, or could be automated, but the message is the same. For a payment of $600 to $1,500 – on your credit card – they promise to negotiate with your credit card companies and get your rate reduced.
Unless a consumer is carrying huge debt, the amount paid for the “service” will not be recouped through the rate reduction, making this scam even worse. At any rate, it’s money paid now, rather than over time. And to add insult to injury, you’ll pay interest on it.
In truth, they will either advise you to transfer your balance to a different card with a lower rate, or will simply make the same phone call to your card issuer that you could make yourself. In fact, they’ll get the phone number from you by asking you to read the customer service number from the back of the card.
Then they’ll set up a conference call with you and your card issuer, and they will simply ask for the reduction. There is no negotiation. And this is something that any consumer can do without any help from a third party.
While they do promise a money back guarantee, the “money back” has not been forthcoming, and the Better Business Bureau has been hearing from unhappy consumers. Few complaints have been resolved.
Section 5 of the Federal Trade Commission Act prohibits unfair and deceptive practices, and this practice does appear to be both unfair and deceptive. In addition, this company may be violating the Telemarketing Sales Rule and the Do Not Call list.
Authorities are warning consumers NOT to give any information to these callers. If you hand over your credit card information, they’re free to charge your account, even if you haven’t agreed to their services. This is just another form of identity theft.
If you’ve already fallen prey to one of these callers and have not received the promised rate reductions, call your credit card issuer and dispute the charge. Be sure to follow up in writing.
You can also report the scam to the Better Business Bureau, the Federal Trade Commission, and the Federal Communications Commission.
Author: Mike Clover
CreditScoreQuick.com your resource for free credit reports, credit cards, loans, and ground breaking credit news.
