Senate To Air Findings In Web "Mystery Charge" Probe

CNet reports on hearings scheduled to open tomorrow in the US Senate on mysterious charges on thousands of consumers' credit cards. The Senate Committee on Commerce, Science and Transportation has been investigating online loyalty programs, which shoppers encounter (often with little comprehension) on the sites of online retailers such as as Continental Airlines, FTD, and Classmates.com. "At the center of the federal probe are Webloyalty, Affinion, and Vertrue, companies that make 'cash-back' and coupon offers to consumers and charge them monthly fees to enroll in their loyalty programs. ... In August, as the government's investigation rolled on, Webloyalty announced that it would alter its ads to require that consumers 'enter the last four digits of their credit or debit card to confirm' they wish to pay the membership fees. Last week, Affinion made similar changes. During the hearing, when the Senate committee is expected to make public the results of a six-month investigation, it will also likely say the alterations made by Webloyalty and Affinion don't go far enough. "

Comments

Could be fixed with a simple law.

[purpledinoz]

A law that explicitly disallows merchants to give credit card information to another party would fix this problem. If the merchant forwards you to another party, then the user must enter the credit card information again.

Re:Could be fixed with a simple law.

[MobyDisk]

I cannot think of any case where I want any company to give away my credit card information. I think most people assume this is illegal already. This is why virtual account numbers are such a good idea - it compensates for an inherently flawed system.

Re:Could be fixed with a simple law.

[SharpFang]

Oh, the more forms there are, the more likely the customer won't make the purchase. Which encourages the sellers to limit the number of forms, which connected with this kind of laws would simply make them give up such shady practices whatsoever.

Re:Could be fixed with a simple law.

[purpledinoz]

I also cannot think of any case where I would want to save the 20s it takes to fill in my credit card info. The benefit to the consumer is, by entering the credit card information again, the consumer knows he/she is being charged for something. Usually, consumers want to know what they're buying, so they would pay much more attention.

Re:Could be fixed with a simple law.

[amicusNYCL]

How about we simply disallow deceptive advertising? That would fix this and a host of other bullshit besides.

That's brilliant! In addition to outlawing it, of course we also need to be able to enforce those rules. So that means that we should set up a federal body, or maybe a commission, that could regulate false and deceptive practices in commerce and trade. Sort of like a Federal Trade Commission, if you will.

Perhaps we could implore President Wilson to consider this in his crusade against the trusts!

Re:Credit cards..

[ShadowRangerRIT]

So you don't do online shopping of any kind? Brilliant. Enjoy paying 20% more for everything.

Of course, you could get a card which you pay off in full every month, and make sure not to sign up for suspicious looking reward programs, but that would require self-control and common sense. If you check your statements occasionally, you can note and contest suspicious charges; the time spent checking is less than the time spent fiddling with cash over the course of a month.

Re:Credit cards..

[IBBoard]

[voice-of-90%-of-Britons]Because it is 'free' money and I can buy stuff I wouldn't otherwise be able to afford[/voice-of-90%-of-Britons]

I agree, it seems completely stupid. The only reason I have a credit card is for the extra protection when buying online versus a debit card, and so that any expenses I incur on company business get paid to me before I pay them to the credit card company! If you can't afford it then you can't afford it, so why make yourself pay more than is necessary for non-essential items as you rack up interest charges?