December 18, 2009
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News: Visa Warns Americans On "Negative Option"
Visa has partnered with the Federal Trade Commission (FTC) and the national Better Business Bureau (BBB) to warn consumers to be aware of a credit card scam known as the “negative option” scam. Consumers fall into the trap by accepting free trials or samples and then find themselves paying recurring monthly credit card charges. According to Visa, nearly one third of Americans have fallen prey to the negative option scam while paying for shipping of the free trials and samples. Consumers don't realize that when they sign up for the free items, that there is a small box that pop-ups pre-checked. The box authorizes the company to ship the items on a monthly basis and bill their credit card.
The small box is typically near the bottom barely noticeable or buried in the fine print or Terms and Conditions. While the consumer thinks they are only signing up for a one time shipping charge, he is authorizing automatic recurring credit card charges. To prevent future shipments and charges, the consumer must uncheck the box or opt-out of the terms and conditions. Often they must notify the company that they are not interested in future shipments before the trial period ends to avoid future card charges, however, the trial period often expires just prior to or after the product is received. Failure to cancel allows the company to continue shipping. Companies also contribute to the delay in recording cancellations with poor and slow customer service and untimely credit card refunds. Visa says Americans should take note and follow these guidelines:
1. Read and understand all terms and conditions. Exercise caution when a purchase involves a free trial.
2. Pay particular attention to any pre-clicked boxes before submitting credit card information for an order. Failure to un-click boxes may bind the consumer to all of those terms and conditions.
3. Try to resolve the situation with the merchant. If unsuccessful, contact the card issuer immediately to dispute the charge.
4. Always review card statements on a regular basis for any unauthorized charges. Notify the card issuer promptly of any unusual activity or unauthorized charges.