Suspicious Credit Card Charge? What To Do About It

Have you ever found a charge you can’t explain? Extra costs, upgrades, late payments. Someone placed a convincing ad, you responded to it, but somehow you now pay more than you expected.

It has happened to everyone. One assumes to know everything that is about the offer until you get your invoice. The majority has canceled subscriptions within the first month for this reason.

It’s, of course, our fault for not revising the terms correctly. But what about the business? If you find them hiding their conditions deliberately, perhaps you should not buy from them.

You may, for example, need to enter your credit card to collect a freebie. Although it’s free today, marketers don’t tell you what it will cost tomorrow. It gives people false expectations about an opportunity, causing them to leave with deception.

Understand that these baits are always “evolving.” You may not be able to prevent 100% of the scams. It’s much more likely that you win after requesting a refund on a dispute (they will approve it along with the countless people who came to complain before you). But they aren’t obliged to pay you back necessarily.

Whether you get the money back or not, you lose precious time and mental energy when arguing with sellers who took advantage of you. You may even be outright exposed to different types of credit card fraud. So how do you make sure it never happens again?

What’s This Charge In My Credit Card Statement?

Mind that providers will rarely charge you without reason. Chances are they disclosed those terms you agreed somewhere you couldn’t read them (the fine print). Despite how unfair it looks, they are legally right with your payment duties.

You may find out later that refunds don’t apply for the product you bought. And if they do pay you back, the refund will exclude the costs of administrative fees and related. You lose either way.

Although ambiguous contracts stand for most of the unexpected charge cases, it doesn’t reduce them. Consider these scenarios the next time you find a surprise bill on your credit card:

A. Providers charged you by mistake

It’s the ideal situation and the easiest one to solve. Businesses make mistakes all the time, but some business owners may try to hide that effect. If the customer doesn’t notice, it’s not a problem!

They may have charged you twice or made you pay for the wrong plan. After you describe the problem, most sellers will instantly refund you. While others may resist, they could offer you a free month of membership instead (in the double-charge example).

B. Ambiguous sales contracts

You see these all the time, especially in saturated niches. Many competitors fight for the same clients with little or no differentiation, so it turns into a price war. Whoever proposes the best deal gets most of the attention.

But as a business owner, you might have come to a point where you cannot drop prices anymore. But with some marketing magic, you can make it look as if customers were paying less, even though you charge the same amount.

You may be familiar with offers that sound too good to be true. It’s inexpensive and easy to join, but then it becomes hard to exit. 

In most cases, the reason you’re buying is not what the owner plans to sell you. Whatever brought you to his store is the hook he used to catch your attention, which may or may not have anything to do with the actual offer (clickbait). 

If you read the whole agreement, the truth will speak for itself.

C. Hidden fees or late costs

Because of competition, advertising has become expensive. Acquiring customers has become a hard battle with little reward. It’s much easier to build existing relationships to make profits, which is why sellers reward long-term clients.

The problem is, these strategies may attract the wrong audience by accident: cheap customers. They come because you promote your software to cost only $5 a month (after you sign up for a three-year contract). Later, when prices increase, they feel conned.

Of course, today’s marketing pays off in the long-term, not the first sale. Making the first sale makes it easier to get the next one, which is why sellers reduce the entry barrier at first. Clients should not, however, get wrong expectations when the service is worth much more.

That inexpensive fee you pay may only apply for the first month, or it requires you to buy some membership before. There’s no reason a company would want to charge you less for the same value.

Because of this confusion, they often offer refunds to filter out cheap clients. But if they don’t give your money back, they’ve scammed you.

D. Identity theft

We really hoped this one wasn’t such a concern, but it unfortunately is. If nobody can explain the credit card charge, then someone else has done it. Now that you’ve questioned yourself and your provider first, it’s time to learn about identity theft.

The worst of identity theft is, you can hardly retrieve any losses. Nobody knows who’s the scammer, how long he has been controlling your account, or whether he’s still doing it. If they transfer your money to them, it won’t be without multiple fake identities in between.

Ironically enough, the place where the threat appeared may have nothing to do with your bank account. Some data breachers can get your credit card data using personal information only. Or perhaps they breached your provider and stole hundreds of accounts at once.

You really can’t be prepared for all of its variations. The best you can do is act quickly and have a backup plan.

How To Prevent Unexpected Charges

The only way to prevent the unexpected is to expect (and prepare for) it. You cannot protect when you aren’t aware of this trick. It’s also quite unlikely (but smart) that you’re trying to prevent a scam that hasn’t happened to you.

You can avoid most financial cons by following responsive practices. So even if these events happen, you will still lose as little as possible. Think twice before you sign that contract:

#1 Read thoroughly

When something sounds too good to be true, questions should arise. The more stressor events appear (time pressure, social proof, loss aversion), the more careful you should be.

At that moment, everything may feel evident, and revisions look like a waste of time. But what if you were wrong? You would have wasted that time and money on a deal you shouldn’t have been in the first place.

Social validation, although useful, isn’t enough to replace individual, critical thinking. If you can’t find anything after reading the agreement, ask them questions directly.

#2 Find out how much you’re really paying

Don’t get too excited the next time you hear the word free. There could be a late payment in the way, or the deal isn’t that valuable. 

They may be saying what you want to hear, so you do what they want you to do. It may not be what you wanted to do initially, such as paying for something you don’t need.

Perhaps the free service does exist, but it requires you to check on multiple conditions. It may not be worth it when you consider the many other businesses offering something better.

Trying to find every possible charge is, ironically, time-consuming. You get the same job done if you ask for the refund policy. Make sure these cover fees as well, so you can undo your payments if they overcharge you. As a last resource, you can always make a chargeback.

#3 Check periodically

No matter how preventive you are, you will inevitably miss some payments from time to time. If you’re not careful, they may affect your credit score. What if an identity thief has got into the account and started to spend like crazy?

You have the highest chance to refund your money when you act fast. By checking your accounts periodically, you increase that chance of success. When it comes to ambiguous contracts, it’s much easier to refund one payment than many accumulated for months.

#4 Follow up on your payments

The process isn’t over after you pay your provider. After you give them your card, pay attention to your account and the messages you get. Make sure you’re only paying for the services you received and double-check for mistakes.

#5 Simplify your finances

How can you be on track with all these payments when you have so much financial complexity? With dozens of credit cards and different accounts per bank, it’s not surprising that you miss one, or that you can’t explain how it happened.
Unless you’re trying credit card churning, you should have no more than a handful of payment methods. You can still have dozens of cards, but always use the same two or three to make it easier to manage.