Check Credit Card Receipts against Statements to Fight Fraud

By Liz F. Kay

The Baltimore Sun

An unfamiliar transaction on a credit card statement might not raise too much alarm if it's just a few dollars.

But all those dollars add up.

Take the case of a recently halted international scheme that bilked more than 1 million customers of more than USD 10 million since at least 2006, all funneled through dummy corporations, according to the Federal Trade Commission.

How did the scam continue unchecked for so long? By making small, unauthorized charges of 20 cents to USD 10.

The money was then laundered through bank accounts in countries such as Bulgaria, Cyprus and Kyrgyzstan, with the help of "money mules" that wired money overseas. The perpetrators are still unknown, according to court documents. The commission filed a complaint last month, and a federal court froze the assets of the dummy companies.

Consumer advocates say the case demonstrates that credit card holders need to be vigilant to spot scams that might otherwise go unnoticed.

"Just because it's on the bill doesn't mean it's legitimate," said FTC spokesman Frank Dorman. "Consumers should check every single item on their bill before they write a check to their credit card company."

In the recent FTC case, charges showed up as one of more than 100 merchant names, including ICH Services, Link Services or World Wide Services. A toll-free number was listed with the merchant, but those numbers were either disconnected or messages were never returned.

More than 1,000 people filed complaints with the FTC about these charges. But that's just a fraction of those who have been targeted, and many consumers might never have questioned the transactions or taken the time to dispute them with their credit card company, given the small amount of the charges.

The FTC requested that the remaining money in the sham corporation accounts be frozen to prevent it from being transferred overseas and to preserve them for victim restitution, according to court documents. However, it's not clear whether the victims will be reimbursed, an FTC spokesman said last week.

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