Chicago Bankruptcy Lawyer Blog

Credit card companies have a fraud department that watches your account like a hawk for high-risk activities. They can be your best friend if your credit card account has been compromised. But they can also be your worst enemy if they mistakenly suspect fraud.

Let me give you an example. Like so many other people who struggle with day to day budgeting, I have a friend, let's call her Carol Consumer, who maintains what she calls her “emergency” credit card. Whenever she uses it, she immediately pays it down to zero, so that the available credit is always there for an emergency. Her logic, and it makes sense, is it’s important to have some money available somewhere, for “just in case” stuff – emergency doctor bills, emergency car repairs, emergency groceries – you’ve probably got your own set of emergency factors. A lot of people have some sort of emergency credit on stand-by.

Well, Carol lost her father recently. That’s a tough situation for anyone, but more so when, as is common in this day and age, family is separated by many miles and not a few states. We all consider that, in an emergency, we can get anywhere we need to get within a day, thanks to air travel.

But within a single 24-hour period, Carol was overwhelmed not just with grief but also with stress, which might have been avoided. In the wake of the phone call alerting her to the sad news, she quickly booked a round trip flight for herself and her family, arranged for a hotel room for the duration of the funeral, and reserved a car that they would pick up at the airport.

Then she went shopping, while still in her own town, to purchase the incidentals needed for the trip and to provide the supplies she had to stock up on for her house/dog sitter. Loaded up with a shopping cart full of goods, she proceeded to the register and pulled out the emergency credit card. Denied. She tried again; after all, she had just used it for the airline tickets and car and hotel reservations. Again, denied. Mortified, Carol paid the cashier with cash, that she really could ill afford.

When she got back home she immediately called the credit card company – one of the “big” ones, starts with a W, in case you’re wondering. Upon speaking with a representative, she learned that, because she had a zero balance for a while (about two months, according to my friend), and all of a sudden there was a flurry of activity on it, they suspected fraud or theft. So, for “her protection,” they said, they blocked her account – no other charges would be authorized until she confirmed that she, the cardholder, had made those charges. The credit card company would, within a week’s time, send an affidavit that she needs to sign and return. And, after they get the affidavit back, her credit card privileges would be restored.

Naturally, Carol was upset, who wouldn’t be? She explained the emergency circumstances, but the representative was either just plain inept or else, just plain insensitive. Carol’s voice ratcheted up a pitch or two, and by the end of the phone call she was in tears. The representative hung up on her.

Once calmed, Carol called back, and took the case up the ladder to a supervisor; she was told that, now, the card was canceled, not just blocked. The situation has escalated from bad to worse.

In an effort to stem the increasing occurrence of fraudulent activities, the credit card companies are becoming too protective, occasionally to the detriment of the consumer. If you are indeed the victim of fraud, you can appreciate their vigilance. But it is absolutely mind boggling that the legitimate cardholder becomes the victim of their own emergency preparedness.

Now, Carol is without a credit card for a trip that she must make. When she gets back, she must deal with the hassle of affidavits and issuance of new cards or even shopping around for a new credit card company that is a little more compassionate.

What could have been done differently? Surely, the credit card company has my friend’s phone number on file. A simple phone call to her, verifying the charges as hers, could have eliminated any doubt. On the flip side, had she been thinking straight, perhaps a phone call to the credit card company by my friend prior to making the charges would have been prudent. But who would have thought that the “next of kin” list would have to include the credit card company?

--Debt Diva