credit cards on desk

Infomercials, Fraud and Your Credit Card – Be Cautious!

Karin Kallmaker Above Temptation, LIFE + STYLE 1 Comment

female figure on headset

This comes under the heading of Public Service Announcement. Today I saw a rash of unrelated Facebook posts that all complained of similar issues dealing with credit card charges where people bought something from infomercials and fell into a pit of credit card hell.

Perhaps it’s because people bought certain kinds of things during and after the holidays. Only now are the problems becoming apparent – not with the product, but with the company hired by the infomercials to take their money.

Why Am I Telling You All This?

I’ve been asked where I got the details about fraud and banking issues that are covered in Above Temptation. I used to be an accountant and as such, underwent audits by CPAs. They love to tell war stories about fraud and issues they detected. I’m also a late night TV junkie and I watch a lot of infomercials while I’m working.

Just for fun – okay, I know it’s a little weird – I will Google the products and then the company that is selling the product and read the horror stories. And they are horrifying: products that just don’t work or were actually harmful. Behind every one of those horror stories is the second wave: the company that took the money is a nightmare worse than a bad product.

Infomericals – The Tricks and Outright Scams

This blog is about the kinds of borderline tricks and outright scams practiced by the companies who fulfill orders and handle the credit cards for the kinds of products you see in late-night TV: infomercials. This blog isn’t about bad products. (Seriously, just put “consumer complaints” after the name of a product and see what you get.) It’s not about shopping networks or channels which operate in a very different manner than what I’m about to describe.

The Basic Warning Spiel

  • Stop.
  • Research.
  • Don’t believe them when they say that offer expires in 4 minutes.
  • Be suspicious.

The Classic Stall

Do not offer up your credit card at any site until you know the name of the company that will take those “3 easy payments.” If they want your credit card before they tell you the actual name of the company run for the hills. Seriously, close the browser window, hang up the phone.

You might be at “,” but another entity (let’s call it “Moneytaker”) is the company that will fulfill your order and take your money. But nowhere before you buy does it say you’re about to do business with “Moneytaker.” That’s a huge red flag.

Or, in an attempt to look upstanding and reliable, the site might say at the bottom in tiny print that it’s run by Moneytaker. Or, the ad for ABCGizmo has a brief splash screen with the number to call in big type. Look quick, because it may say Moneytaker Enterprises LLC in small, pale print.

Before you go any further with your purchase, ignore everything that was said in the infomercials and concentrate on the printed words. Google the moneytaker’s name with the words “consumer complaints” and see what comes up. Generally, several of the first five results will be consumer boards or forums where people post complaints. If there’s relatively few spaced far apart that’s one thing. But if there is a constant stream of similar complaints about nonexistent refunds, unanswered phones, failure to cease monthly billing when the total is paid, or failure to stop sending automatic refills then consider yourself warned.

The Impossible Cancellation

A common scam with infomercials and their fulfillment sites is that they won’t let you cancel an order even if they have “money-back guarantee” plastered all over the site. Let’s say that from the checkout material it’s plain that your items won’t ship for several days, or even weeks. You’ve thought it over and realized you bought more than you meant to or you’re just plain having second thoughts.

So you call the toll-free number. They said you’d get your money back for any reason, and they haven’t even sent you the order yet, so cancelling the order seems easiest all the way around. Yeah, no.

  • You could find out that number only works if you’re calling from another state.
  • Or that you’re put on hold and no one ever picks up.
  • Or, if you get through, you are told to call back the following day, in the afternoon, to talk to the cancellation department.

These are all stall techniques. When you call back or finally get the right number they will tell you that your order has already shipped, too bad, so you’ll have to arrange to return it (at your expense) and request a refund (but they won’t refund the shipping and handling). You’ll likely receive your merchandise with ample proof that it shipped days, if not weeks, after your call. So instead of telling you there is a “no cancellation” policy up front, they imply there is, and then simply don’t let you cancel.

So the first time you talk to someone be blunt. Explain that if they don’t cancel the order your next call is to your bank to report fraud and their charge will be rejected. If you get the run around, make that call to your bank and find out exactly what you can do to stop the charge. Cancel the card if you have to. And consider yourself lucky.

The Non-Existent Refund

Let’s say you don’t get the order cancelled and you’re going to send it back and get a refund under their money-back guarantee. For one thing, you’ll never see the money you paid for shipping and handling refunded. You’ll also pay to return the item. The website that so eagerly took your order has no return process, so you must call them. But when you call you get a run around similar to what I described for trying to cancel the order.

The people who issue return authorizations are only there yesterday and tomorrow.

They may charge you for a return label and then never issue a refund. Or say what you returned was damaged due to your poor packaging, so no refund. That’s why it’s so important to do that bit of research before you place the order.

Automatic Refill Hell

If you decide to go ahead with your order, do not agree to automatic refills from this type of company. They’ll dangle a discount to make it seem like the smart thing to do but it may lead to a pile of regret. Most companies will want to refill your supply of whatever before you’ve exhausted what you have. They give you 25% off and send you twice as much.  That math is not in your favor.

Female figure pushing back
So when you get backed up on the automatic refills and try to cancel, that’s when you find that the Moneytaker is run by incompetent illiterates who haven’t a clue how to do what you’re asking… Their systems are down, they don’t know which button to push, no one has ever done this before.

Know what? That’s all a lie. You’re a fish on the line, dear friend. They’re just stringing you along. If the pretended incompetence doesn’t work you might even find yourself abruptly disconnected, and they have no idea how that happened. This is my personal favorite: Can they send you something else to make you happy? There’s only a small shipping fee. That’s right – you’re trying to get a refund and their answer is to upsell you something else! (Can you hear my eyes rolling right now?)

Or they’ll make it seem as if you didn’t do the right steps in the right order so it’s all your fault that they can’t issue you a refund.

Don’t fall for any of it. Tell the person on the phone they need to cancel all future shipments because you’re cancelling the credit card they have and you’re not giving them a new card number. You might actually get someone’s attention. If not then do the deed: cancel the credit card. Do it right then or wrangle with the company another six months and still end up cancelling the card – your choice.

About the Person on the Phone

Your call is being routed to a call center. The staff is receiving minimum wage (in the U.S.) or a few dollars a day (elsewhere) to read you a script. If they work for this kind of company they probably aren’t empowered to help you at all. That’s why you must say things like “I am cancelling this credit card” or “I am filing a fraud claim if you don’t connect me to a supervisor.”

You may even be doing them a favor – until you say the magic words to escalate your call, they must repeat their script, listen to your ire and put up with anything you say or risk losing their job. Save yourself and the front line person on the phone stress and time.

The moment you get nonresponsive customer service, start escalating. Say the magic words “escalate” and “supervisor” and “fraud claim” like you’re Hermione Granger unleashing expecto patronum.

If you still get nowhere, document your attempt to work it out, that you attempted to escalate, then protest the charges to your credit card company. You’ll have a stronger case with them to get the charges reversed.

Never Ever Use a Debit Card

Never, ever, never ever never give these companies access via a debit card. For example, let’s say you shop more safely by using an intermediary like Paypal. But the Paypal source of funds is a debit card to your checking account. Moneytaker won’t stop sending you shipments and that money is coming out of your checking account. You live without the cash until any dispute is resolved.

This is also why I don’t recommend using a debit card-backed account for subscriptions.

Find Out Your Rights

Your rights as a consumer vary from state to state. Credit card agreements often have good protections for you if you complain promptly and can document your attempts to resolve the issue with the company. Often, too, your local news outlets will have consumer fraud tips that you may find helpful. But many of these companies move around to take safe haven in states that don’t rapidly enforce consumer protection.

Your best protection is to:

  • Stop.
  • Research.
  • Don’t Order in a Rush.
  • Be suspicious.

Guilty Until Proven Innocent

  • A well-run business will give you all the details of a transaction before you give your credit card number.
  • They will not have scores and scores of complaints found by an easy web search.
  • The moneytaker is named in materials before you buy.
  • The return and cancellation policy is easy to find.

The less true these statements are of a company the more you should question whether you want to give them your credit card number.

For the person who wants to protest that there are legitimate infomercial companies that are run honestly and I’m damning them all with a broad brush… If the company is on the up-and-up you should get all the reassurance you need from a simple search online. There is far too much fraud and snake oil out there now to pretend my blog is a court of law. When it comes to infomercials, I’m very much a consumer who believes guilty until proven innocent.

But What About Shopping Network Channels?

Most of the time, the channels are selling merchandise by consignment. They will take your money and fulfill the order. If you have issues, you’re dealing with a company that does care about their reputation. Be wary if the segment featuring a product redirects you to a site not their own to make the purchase. That means you’re at the mercy of that other site, which could be the kind of moneytaker I’ve described.

Go forth and shop safely!

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