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Protecting Yourself Against Automatic Debit Scams


(continued from Automatic Debit Scams)...

WHAT YOU CAN DO TO PROTECT YOURSELF Against automatic debit scams

It can be difficult to detect an automatic debit scam before you suffer financial losses. If you do not know who you're talking to, follow these suggestions to help you avoid becoming a victim:

  • Don't give out your checking account number over the phone unless you know the company and understand why the information is necessary.
  • If someone says they are taping your call, ask why. Don't be afraid to ask questions.
  • Companies do not ask for your bank account information unless you have expressly agreed to this payment method.

IT'S THE LAW: Since December 31, 1995, a seller or tele-marketer is required by law to obtain your verifiable authorization to obtain payment from your bank account. That means whoever takes your bank account information over the phone must have your express permission to debit your account, and must use one of three ways to get it. The person must tell you that money will be taken from your bank account. If you authorize payment of money from your bank account, they must then get your written authorization, tape record your authorization, or send you a written confirmation before debiting your bank account. If they tape record your authorization, they must disclose, and you must receive, the following information:

  • The date of the demand draft;
  • The amount of the draft(s);
  • The name of the payor (who will receive your money);
  • The number of draft payments (if more than one);
  • A telephone number that you can call during normal business hours; and
  • The date that you are giving your oral authorization.

If a seller or tele-marketer uses written confirmation to verify your authorization, they must give you all the information required for a tape recorded authorization and tell you in the confirmation notice the refund procedure you can use to dispute the accuracy of the confirmation and receive a refund.

WHAT TO DO IF YOU ARE A VICTIM

If tele-marketers cause money to be taken from your bank account without your knowledge or authorization, they have violated the law. If you receive a written confirmation notice that does not accurately represent your understanding of the sale, follow the refund procedures that should have been provided and request a refund of your money. If you do not receive a refund, it's against the law. If you believe you have been a victim of fraud, contact your bank immediately. Tell the bank that you did not okay the debit and that you want to prevent further debiting. You also should contact your state Attorney General. Depending on the timing and the circumstances, you may be able to get your money back.

For individuals and families trying to figure out how to pay off debts, American Consumer Credit Counseling (ACCC) provides nonprofit credit counseling, credit card reduction and consumer debt management services for consumers nationwide. Our certified credit counselors provide financial education for anyone wanting to learn how to get out of debt and how to eliminate credit card debt. As alternative to expensive debt restructuring services and credit card debt consolidation loans, our debt management plans are a kind of credit card relief program that have helped thousands of people pay down credit card debt by consolidating payments and reducing interest rates and finances charges. We also offer bankruptcy counseling, housing counseling and other financial education services for help getting out of debt.

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