Consumers across the U.S. and Canada are sounding off to Better Business Bureau about incessant automated telemarketing calls promising to lower interest rates on their credit cards. Not only are the calls a nuisance and violate u.s. and Canadian Do-Not-call laws, but some companies behind the calls are bilking consumers by charging thousands of dollars in up-front fees to negotiate lower interest rates with credit card companies-something consumers can do on their own at no cost.
According to figures cited by the White House in January, credit card debt increased 25 percent in the past 10 years, totaling $963 billion – with current per-household credit card debt at nearly $9,000.
Knowing that so many families are drowning in debt, telemarketers offering suspect financial assistance are taking full advantage of the situation. Consumers have reported receiving calls as early as three in the morning and on both their cell and home phones even when they have registered the numbers with the federal Do-Not-call lists. Consumers also tell BBB that, despite their requests to the telemarketers to stop calling, the calls continue to come.
Connecticut Better Business Bureau President Paulette Scarpetti urges Connecticut residents to be wary of this scam to prevent falling prey to it.
'Unfortunately, people who most need help with their credit are being deceived by these companies, and charged for a service they don't even need."
BBB has received numerous complaints nationally about two Orlando-based companies, CSTR, Solutions, Inc., and Genesis Capital Management, and one Tacoma-based company, Mutual Consolidated Savings. All are behind at least some of the robocalls and are promising to save people anywhere from $2000 to $25,000 by negotiating lower interest rates with credit card companies.
Robocalls generally begin with recorded messages that include statements like:
"There are no problems currently with your account, however it is urgent that you contact us concerning your eligibility for lowering your interest rates to as little as 6.g per cent"' or, "This is our final attempt to reach you since you’ve not responded to our other calls to discuss your credit card debt." The automated message invariably does not include the name of the company, but may claim to be with Card Services or Card holder services. Complainants tell BBB that they now believe the calls were designed to deceive them into thinking their credit card company was contacting them.
After the initial recorded message, consumers must dial another number to be connected to a live person. The live "operator" usually starts the sales pitch by asking for the consumer's credit card number and whether the consumer is interested in lowering their interest rates. From there, callers begin closing the sale, asking if the consumer is willing to pay - usually from $700 to $1,000 – to have their firm contact the credit card company and negotiate lower rates.
According to BBB complaints, companies are failing to uphold money-back guarantees and are not refunding money in cases where they are unsuccessful in lowering rates.
BBB offers the following advice for consumers who receive this type of call:
*Never give personal information, including Social Security, bank or credit card numbers over the phone to an unknown telemarketer.
*When considering any company offering any type of financial assistance, insist on getting a contract in which all terms and conditions are clearly explained before signing up or providing credit card or other payment information.
*Always research the company first by reviewing its Reliability Report at www.bbb.org.
