Just about all transactions are done with plastic these days, so when a consumer decides to part ways with a company, he or she has to make sure the company stops entering charges on the account.
In most cases, this isn't an issue. But when a consumer wants to cancel a recurring charge and the company makes it difficult, the consumer may feel there are few options. This seems to happen a lot in the case of anti-virus software subscriptions or online dating sites that auto renew.
When you purchase anti-virus software, for example, you should assume that the account will auto renew when the subscription ends. The company will tell you it does that to make sure your protection is not interrupted because you forget to renew.
There might be some truth to that, but it is also a fact that many consumers decide after a year they don't need the product any longer, or are dissatisfied and want to try something else.
So pay attention if the company sends you an email – as it should – telling you the account is about to auto renew. If you don't find a way to turn off the auto renew, the charge will show up on your credit or debit card.
People who sign up for free trials also find it sometimes hard to stop recurring charges. Usually, you have a set period – anywhere from seven to 30 days – for the trial. If you do not cancel before the period is up, the company will begin charging your credit or debit card on a monthly basis.
If you are lucky you will find a human being on the company's customer service line and work out an acceptable solution. But many companies have automated systems and consumers hang up in frustration.
When that happens, what do you do? What you don't do is cancel your card and replace it with a new one, with a different number. If you do, you might be surprised to learn that the company with your old credit card can keep charging your new one.
That's because credit card companies offer a service to merchants, supplying them with updated account information about consumers with whom they do business. Sometimes that works to the consumer's benefit – they don't have to contact all the companies that have their credit card information.
But when the consumer changes cards to escape unauthorized charges, it definitely is not an advantage.
Visa offers a service called Visa Account Updater (VAU), and promotes it to merchants as a way to reduce authorization declines. An authorization decline, of course, is exactly what a consumer locked in a dispute with a merchant wants and expects.
“Merchants enrolled in VAU receive updates to cardholder account information, including new account numbers, new expiration dates, and/or contact cardholder notifications from participating Visa issuers,” Visa explains on its website.
ConsumerAffairs reached out to Visa's media relations department two days ago to ask if there is a means for consumers to exempt their accounts from VAU, but as yet we have received no reply.
What to do
If you believe the charge on your account is unauthorized, the first step is to contact your bank or credit card company and tell them you want to dispute a charge.
In most cases these institutions will be helpful, and when they get involved a merchant will pay attention. You may not be able to recover all the money taken from your account in the past, but you should be able to stop the recurring charges.
If you live in a state with a consumer-friendly attorney general, calling the AG's consumer hotline may help.
Finally, if other options continue to fail, filing a complaint with the Consumer Financial Protection Bureau may help. Here's the link.
And don't forget to post a review of your experience at ConsumerAffairs so that you can help other consumers handle similar problems.