Prepaid Debit Card Reviews, Complaints, Etc

Author: Chris Warren

  • Green Dot Fights Scammers

    Green Dot Fights Scammers

    It seemed like a genuine family emergency. When an 81-year-old Cincinnati resident named Roger answered his phone last December he thought he was talking to his grandson, who told the elderly man that he was in big trouble. The caller told Roger that he had been arrested for speeding and drug possession and needed $7,000 so he could post bail. Being a devoted grandfather, Roger quickly put the money on a prepaid debit card and gave the account number to someone he thought was a police officer.

    The only problem: Roger reached his real grandson on his cell phone and realized that he had been swindled. Roger’s tale (he insisted on anonymity for fear of being targeted by other criminals) was one of the stories’ victims of so-called “grandparent scams” told to members of the US Senate’s Special Committee on Aging on July 16. By no means is Roger alone. According to the Federal Trade Commission (FTC), Americans were cheated out of $73 million by imposter scams, a number the government believes is far below the actual cost of all of this type of crime.

    Although the hearing was designed to highlight the impact these crimes have on the elderly, it also resulted in some genuine action. In its own written testimony before the committee, Green Dot Corporation, one of the leading suppliers of prepaid debit cards, announced that it would eliminate the MoneyPak PIN, which allowed money to be added to an account to take place via phone. Instead, Green Dot, which issues the Walmart MoneyCard, will now only allow cardholders to reload their accounts with cash in person – a method known as “swipe reloading.”

    It’s a change Green Dot insists will make it harder for criminals to commit fraud. “Without the MoneyPak PIN, the scammer will have no method of instructing a senior to buy a product and no method of redeeming any associated PIN number,” Green Dot said in its testimony. The company says the MoneyPak PIN has already been removed from all Walmarts and it expects it will be eliminated from all retailers by early 2015.

     

     

     

     

  • How To Fix Your Credit Report

    How To Fix Your Credit Report

    There are plenty of compelling reasons people should want to have a good credit report. A solid credit report leads to the sort of credit score that makes mortgage and auto lenders eager to give you the best interest rates available. Simply put, it means you can save a lot of money in interest payments over the years, especially with the sort of big-ticket items you typically need a loan to buy.

     

     

    While most of the work involved with having a good credit report and score is in our hands, your good credit can sometimes require the credit bureaus not making errors. Sadly, they are far from infallible. A Federal Trade Commission (FTC) study conducted last year found that five percent of consumers had errors on their annual credit reports that could cause them to have to pay more interest on their loans. Furthermore, the FTC study also discovered that 25 percent of people found errors on their credit reports.

    Which is why it’s so important to catch and correct any errors that show up on your credit report as soon as you possibly can. A recent story in US News & World Report provides tips on how to do that.  Here are some of the suggestions, provided by reporter, Jenna Lee:

    • Review those reports. You can’t fix what you don’t know about. So the very first step to ensuring that a faulty credit report won’t cost you serious money is identifying any errors. That is easy to do now that the law entitles Americans to a free credit report each year. All you have to do is go to AnnualCreditReport.com and request a report from each of the three major bureaus, TransUnion, Equifax and Experian.
    • Take a very close look. Once you receive your credit reports, take out that magnifying glass and look for errors. In particular, pay close attention to account details that are wrong and, even worse, fraudulent accounts (i.e. ones you didn’t open).
    • Get proof you’re right and they’re wrong. The credit bureaus aren’t just going to take your word for it that they’ve goofed. You’ll have to assemble documentation that highlights their errors.
    • Write a letter. Once you have all of the information you need to dispute any errors, you’ll have to alert the credit bureaus of the mistakes. Do that by writing a letter to each bureau. The FTC provides a sample letter that makes it easy.
    • Be prepared to wait. Sending in a dispute letter obligates the credit bureaus to act, which generally takes place within 30 days. If you don’t hear anything back in that timeframe, be prepared to follow up.
    • Remain vigilant. The good news, as Lee writes in her story, is that the FTC report found that four out of five consumers who disputed an error had at least some success in correcting the problem. But Lee offers up some important advice for even those folks who are successful. “New errors could be introduced in the future,” she writes. “Continually monitor your credit to ensure your information remains as accurate as possible.”

     

     

  • Advice To Homebuyers: Boost Your Credit Score

    Advice To Homebuyers: Boost Your Credit Score

    It seems like such a simple equation. If you want the best mortgage interest rate, be sure that your credit score is as high as possible. And for once, this deceptively easy to understand formula actually is true. You really can get better interest rates if you can boost and keep your credit score as close to the maximum of 850 and steer it clear of the low end of 300.

    According to a recent story by mortgage and credit expert, Dan Green, there are some easy ways to get that all important credit score up to where it will really do a potential homebuyer some good. “Anyone can raise their credit score to “Excellent.” This is because credit scores are based on a formula and parts of the formula are well documented and described,” writes Green on the website, The Mortgage Reports.

    So what does Green suggest? First of all, it’s important to understand what scores actually matter. While there are many credit reporting companies in the market, he says that only three matter when it comes to mortgages: Equifax, Experian and TransUnion. Not only are those the only three credit reporting outfits that matter, Green says that anyone considering buying a home needs to realize that only specific reports issued by these companies are used by mortgage lenders. They are:

    • The Equifax Beacon 5.0 report
    • The Experian/Fair Isaac Risk Model v2 report
    • The TransUnion Fico Risk Score 04

    This is important to know because these are the reports mortgage lenders analyze when they’re considering your application for a home loan. “Your lender then takes the median of the three scores (i.e. the one in the middle), and calls it your credit score,” writes Green.

    One benefit of applying for a mortgage is that a lender will supply you with a copy of your credit score for free. Green suggests you take advantage of this access to a free credit score and also pay heed to the notes that accompany them, which provide a road map to improving your score. Tips will include the obvious, like always paying your bills on time, and the less clear cut, such as keeping older credit cards open and using them from time to time.

    Another bit of advice Green offers is to note how close you are to the credit limit on any of your cards. If you’re near the limit, that is a black mark against you in a lender’s eyes – the ideal is to have a balance of less than 30 percent of your credit limit. If you can’t pay down the limit, Green suggests asking the credit card issuer to up your card’s limit to get it below that 30 percent threshold. Paying close to attention to credit scoring details, insists Green, can up your score by 100 points in no time.

     

     

     

     

  • Turning Student Debt Into Good Credit

    Turning Student Debt Into Good Credit

    There’s just no escaping the fact that a mountain of student debt is a big burden. And these days, kids fresh out of college are looking at a Himalayas-like amount of debt to pay off before they’ve even started their careers. According to a recent story in US News & World Report, college kids owe an average of $33,000 from the moment they grab their diplomas and stride into adulthood.

    But in that same story reporter Divya Raghavan offers up a way grads can make lemonade out of that forest of lemons. How? By responsibly paying off all of that student debt and showing lenders that you know how to handle your finances responsibly. Doing so is a way to build the kind of credit score and credit history every adult needs. “They can result in a graduate being able to qualify for his or her first apartment, first car loan and, very often, first unsecured credit card,” writes Raghavan.

    As Raghavan points out, there’s nothing particularly magical about how this all works. In simple terms, a large amount of student debt can only be paid off with diligent and persistent hard work. Which means that if a fresh graduate makes on-time payments month after month creditors are going to get the message that this young adult is someone who can be trusted with a car loan, mortgage or credit card. Lenders will know that a former student is low risk because student loan payments are reported to the three major credit bureaus, TransUnion, Experian and Equifax. The credit score and report that these agencies come up with is based on how timely and complete those repayments are.

    And their impact goes beyond just how likely you are to get a car loan. There are times when prospective employers will ask applicants for their credit report. Although employers can only review a potential hire’s credit report with the consent of a job applicant, it’s important to be aware of the possibility of a request. In fact, a study by the Society for Human Resource Management found that almost half of employers conducted a credit check on potential employers.

    There are times when even the most well-meaning and responsible graduate just can’t make those loan repayments. When that is the case, Raghavan writes that the best approach is to defer the loans. Defaulting on the debt will do lasting harm to your credit score. “As a good rule of thumb, remember that it’s OK to defer, but not to default,” she writes.

     

     

     

     

     

  • IRS Rule Change Targets Identity Thieves

    IRS Rule Change Targets Identity Thieves

    It’s not just big retailers like Target that are grappling with ways to thwart identity theft and fraud. The Internal Revenue Service recently announced plans to limit direct deposits of refunds in an effort to fight criminal activity targeted at taxpayers.

    According to a recent article in Accounting Today, the IRS will limit the number of direct deposit refunds that can go into a single account or prepaid debit card to three. Once the IRS has made three electronic deposits into a single account it will automatically issue paper checks for any additional refunds. Any taxpayer who does reach the threshold of three direct deposits will be notified by the IRS that they’ve reached their limit and will receive only paper checks in the future.

    The new procedures will go into effect in January of 2015 and are meant to make it more difficult for criminals to steal taxpayer identities and hijack their deposits. Currently, an identity thief or unscrupulous accountant could set up an account or obtain a prepaid debit card into which they could funnel multiple tax refunds. “The new limitations will also protect taxpayers from preparers who obtain payment from their tax preparation services by depositing part or all of their clients’ refunds into the preparers’ own bank accounts,” said the IRS in a statement. “The new direct deposit limits will help eliminate this type of abuse.”

    However, the IRS did caution that some responsible taxpayers will be negatively impacted by this change in procedure. For instance, families that file multiple tax returns and have all their refunds direct deposited into a single account will need to either open new accounts or be willing to receive paper checks. Despite the change, the IRS still urges taxpayers to utilize direct deposit. “The vast majority of taxpayers will not be affected by this limitation, and we would encourage taxpayers and tax preparers to continue to use direct deposit,” the IRS said. “It is the fastest, safest way for taxpayers to receive refunds.”

     

     

  • A Wave of Debit Card Fraud

    A Wave of Debit Card Fraud

    It’s the sort of call that is becoming unnervingly common these days. Police in the city of Gilbert, Arizona near Phoenix, recently warned that criminals impersonating law enforcement officers were phoning residents and threatening them with arrest unless they pay outstanding traffic tickets. The way to pay the fictitious tickets? By handing over credit card numbers or prepaid debit card PINs.

    In Tuscaloosa, Alabama, another group of recent debit card fraud perpetrators were even more ominous. “We have had a couple of bomb threats in the city of Tuscaloosa. The caller will state if you don’t put so much money on a Green Dot [prepaid] card or the bomb will blow up in an hour,” Sgt. Brent Blankley of the Tuscaloosa Police Department told the local Fox TV channel.

    While the locations and cover stories are different, the use of prepaid debit cards and other plastic forms of payment by scammers is becoming an almost everyday occurrence. In fact, according to a new article on MarketWatch.com over 40 percent of Americans have faced some sort of debit card fraud or credit card scam sometime over the past five years. Not surprisingly, about half of Americans engaged in so-called “risky” financial behavior – everything from writing down a PIN number to carry around in a wallet or not shredding documents with sensitive account information – were victimized.

    Given the constant onslaught by scammers and the successful efforts to obtain customer information from large stores like Target, it’s reasonable for people to take steps to protect themselves from debit card fraud and credit card scams. A start, of course, is not engaging in the sorts of risky behaviors that are easily avoided. The MarketWatch article, citing research conducted by ACI Worldwide and Aite Group, provided a list of five activities to avoid.

    As a start, reporter Priya Anand says leaving a cell phone unlocked is an invitation to criminals to access personal financial information. Despite the risks, 11 percent of Americans don’t protect their phones. Second, over 10 percent of Americans don’t bother to shred documents that include personal financial information before tossing them in the trash. This should be avoided.

    Third, banking or shopping on a public computer, like those available in a library, can make your banking and credit card information easily available to thieves; still, almost 10 percent of Americans do this. Fourth, actually giving out your financial information to the type of scammers operating in Arizona and Alabama is also a bad idea, as is replying to emails requesting your account information. And finally, writing down a PIN and putting it in your wallet or purse could very well get you in financial trouble. But taking simple steps can protect you from debit card fraud and credit card scams.

     

     

     

     

     

     

     

     

     

     

     

     

Prepaid Debit Card Reviews, Complaints, Etc