"Mr. Proffitt, we wanted to inquire about possible fraudulent charges on your account made yesterday…"
And with that, my day went to heck in a hand basket.
It turns out that somehow somebody got a hold of my credit card and managed to rack up some interesting charges at a big-box electronics store a few towns over. The good news is, the fraud division at my bank flagged them and the charges were quickly removed and after filing a police report (a requirement here in Indiana), the matter was closed and I had a new credit card in hand by the end of the week.
That's when things got interesting.
It turns out that on this card, which I used mostly for personal purchases, there were a number of recurring charges that I'd neglected to check up on over the years, and discovered only after the original card number had been shut down and the vendors came calling for their next monthly payment.
Legal, But Not Good
These are known as "gray charges," legal but sometimes unexpected or forgotten charges to a credit card that just keep hitting an account indefinitely.
In my case, some of the charges were perfectly fine: Netflix pinged me when because I hadn't changed my account payment information before the first of the month (I'd forgotten that I'd started Netflix on this card and not my debit card). The New York Times, the same thing.
But I also got requests for payment from things that should have been dropped a long time ago. An annual fee for an aviation website that I'd used when I was actually using my private pilot's license; a credit reporting service fee that I was reasonably sure I'd cancelled.
One In Four Are Victims
According to transaction monitors BillGuard, I'm not alone. One in four consumers have been tagged with these gray charges, which typically accumulate like barnacles on your account as the years go by. Even diligent-ish bill payers like me may miss them, especially when charges aren't made on a regular basis.
Getting a new credit card was a pain, but it also prompted me to scrape off those barnacles on my account. Fortunately, there were only these two, which were costing me about $146 annually. I was lucky; BillGuard estimates that the average gray charge victim racks up an average of $356/year in grey charges.
Because the Holidays are an especially good time for these kinds of charges to glom onto your cards, BillGuard has published a useful infographic detailing the problem and ways to look out for charges like this, which often ride the bleeding edge of legality.
Title image courtesy of Shutterstock.
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