Cramming: A New Type of Credit Card Fraud

Cramming: A New Type of Credit Card Fraud

March 20, 2013         Written By John H. Oldshue

Ever notice $10 to $50 missing from your available credit balance without a clue as to why? If so, you may be a victim of “cramming,” a new type of credit card fraud.

Cramming involves the use of unauthorized small charges over a long stretch of time, most of which go unnoticed. The Federal Trade Commission predicts that such fraud has led to more than $24 million in stolen funds to date.

Most of the cardholders who discovered this problem were closely monitoring their bills at the time. A large portion of them had recently filed for a payday loan before noticing the issue.

This problem is similar to another form of cramming discovered by the FTC, which occurred on phone bills across the country. Rather than charging $20 or $30 on the bill, companies were only adding $2 to $3. Those numbers are much more proportional to the average user’s bill. The FTC has encouraged consumers to pay close attention to fluctuations like these in their phone bills, and they are now doing the same for credit cards.

What can you do to avoid being crammed? Follow the tips below:

  • Keep a log of your purchases every month, like you would with a checkbook for your bank account.
  • Understand each of the fees on your credit card statements, and ask about any that look questionable.
  • Review your card statements regularly and cross reference those charges with the ones from your log.
  • Keep your outstanding balances low.
  • Report any unauthorized charges right away to avoid them in the future.

As long as you are aware of what is going on with your credit cards, you should be able to correct any cramming that may arise.

The information contained within this article was accurate as of March 20, 2013. For up-to-date information on any of the terms, cards or offers mentioned above, visit the issuer's website. Many of the offers on this article are from our affiliate partners, and LowCards.com may be compensated if you take action with any of our affiliate partners.

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About John H. Oldshue

John Oldshue is the creator of LowCards.com. He worked for over 15 years in television and won an Emmy award for his reporting. He covers credit card rate issues for LowCards.com.