AGO offers ways on better use of credit cards

The Attorney General’s Office yesterday offered suggestions on the better use of credit cards especially during the holiday season when people spent hundreds, or even thousands, of dollars using what has been called the plastic money.

Plastic is quickly overtaking cash and checks as the primary method of payment by consumers. The AGO said a few precautions should be strictly observe to ensure that the charges billed on consumers’ credit card are actually theirs.

Consumer Counsel David Lachobay, in a media statement, said consumers should immediately sign their credit cards as soon as they arrive since signature verification by merchants is the single most effective guard against unauthorized use of the cards.

“Keep an eye on your credit card during transactions, making sure you get it back as quickly as possible. Be careful about giving out your credit card number over the telephone,” the statement reads.

With the rise of online merchandising and telemarketing, the previously unacceptable practice of giving out credit card numbers over the telephone has been modified to an admonition to be careful.

Mr. Lachobay’s media release said it is acceptable to charge items to a credit card over the telephone when dealing with reputable businesses in a straightforward consumer purchase transaction.

However, it is not acceptable to give credit card number to a caller who claims a card user has won a prize and needs the number to verify his eligibility. Such calls are used to merely obtain credit card numbers.

“You should always know where your credit card are. If one is stolen or lost, report this immediately to the issuer by telephone, and follow up with a notification in writing. You are not liable for any charges made after the card was reported lost or stolen,” said the AGO statement.

Cardholders are only liable for $50 of charges made before the notice was given. Because many people have multiple cards, even the $50 limit can result in significant liability in the event of theft of wallet or purse.

If consumers have a dispute with a merchant in a transaction in which they paid with a credit card, they may have a right to what is commonly called a “charge-back” from the credit card company.

Under federal law, a credit card company is liable to the same extent as the merchant for claims arising out of credit card purchases if consumers have made a good faith attempt to resolve the dispute with the merchant, the amount of the transaction exceeds $50, and the transaction occurred within the same state as the billing address.

The AGO is also advising credit card holders to read monthly statements carefully and the same day these arrive; never sign an incomplete receipt; treat their cards as if they were cash; make a list of card numbers and the telephone numbers of the issuers; tear up the used carbon paper from certain types of old card machines; never give Personal Identification Number PIN for the credit cards to anyone; and do not write the PIN code on the card nor keep it with the card.