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What You Should Know About Credit Card Insurance Fraud

Have you ever answered your phone only to find someone on the other end of the line telling you that your credit card has been flagged for an unusual purchase pattern? Has the caller warned you of fraudulent activity on your credit card? Did the caller ask you to verify your address, credit card number, or any other personal information? If you answered yes to these questions, then you may have been a target of credit card fraud in Iowa.

Sometimes these telemarketers will tell you that you need credit card insurance in order to protect yourself from theft or rloss of your credit card.. The person on the other end of the line will try to sell you credit card insurance or a protection package in order to safeguard your credit card from fraudulent activity. The money taken from you in exchange for "protecting" your credit card is generally fraudulent. Most of the time, these companies do not provide any protection. Instead, they take your money and make it almost impossible for you to cancel the service.

What most people in Iowa don't know is that consumers are already protected by this type of activity under federal law. Consumers are only liable for unauthorized charges below $50 for each credit card. In addition, the misleading companies will tell you that you only have a certain amount of time to report a loss or fraudulent activity, when, in fact, no time limit exists under federal law for reporting a stolen card or unauthorized charges.

What is credit card insurance?

Credit card insurance can be obtained for a fee. Typically, a company will explain this service as a payment protection to you in the event of death, illness, or loss of job. It is generally a scam, because if one of these life events occurs, your life, health, or disability insurance will typically kick in. However, credit card insurance offers to pay the credit card minimum payment or balance if one of these life events occurs.

Why is credit card insurance a scam?

Credit card insurance isremains one of the most expensive types of insurance a consumer can purchase. If someone really wants credit card insurance, he or she should talk to the credit card company instead of going to a third party or speaking with a telemarketer.

The fraudulent companies involved in these types of scams typically deduct a couple hundred dollars from a person's credit card for this protection service, and do not provide anything in return. Most of the protection they try to sell is already available from the credit card issuer.

In the last several years, the Federal Trade Commission (FTC) has brought legal action against many fraudulent companies selling credit card insurance and protection services.

If you have been a victim of credit card insurance fraud in Iowa, then contact the law office of Brady & O'Shea today. Learn your consumer rights and speak with an experienced Cedar Rapids consumer fraud attorney today. Call (319) 866-9277 for your free legal consultation, or visit our website and fill out our online contact form, and we will contact you.


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Brady & O'Shea, PC
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Cedar Rapids, IA 52402
Phone: 319-866-9277
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