Citibank Thinks Donating to the Red Cross is “High-Risk Activity”

We recently bought a computer with a credit card and received a call confirming that we did, indeed, want a computer. We thought this was slightly annoying but nice, and appropriate because we don’t go around buying computers every day. The credit card company (not Citi) didn’t, however, stop the charge from going through. They just called us later. Not so for the blogger at Fivecentnickle.com. He tried to donate to the Red Cross with his Citi credit card. They stopped the charge, didn’t inform him right away that it hadn’t gone through, and, since it was the last day of the year, now Mr. Nickle might not get his charitable deduction for 2006.

Rather than phone Mr. Nickle about their suspicions that he was a tightwad who would never willingly donate to charity, Citi left a note on his account.

    A review of this account has shown recent high-risk activity. Please contact our Customer Service Unit at 1-800-950-5114.

Good job, Citi. As Mr. Nickle said, “While I’m all for fraud prevention, this is way overboard.” Would it have been so difficult to call? —MEGHANN MARCO

Citibank Refused to Process our Red Cross Donation [Fivecentnickle] (Thanks, Ashley!)

Comments

Edit Your Comment

  1. acambras says:

    Hmmm. After 9/11 and Katrina, some might argue that donating to the Red Cross IS a high-risk activity.

  2. nweaver says:

    Actually, its a REAL concern. Here’s why…

    Hackers are able to steal a LOT of credit card numbers at a time. But a lot are no longer valid. Those #s are much more valuable if they are verified to be working.

    Thus donations through charity websites are sometimes used to validate card #s. There was a 5 AUS charge on a credit card I no longer used that was specifically this occurance.

  3. ord2fra says:

    I can confirm this with NWeaver… I had a friend fall victim to a PayPal spoof attack, and the first thing the thief did with the CC number is donate to the Red Cross. I think it was $25.

    A one-time, out of the blue donation to a charity may be a signal to the credit card company that the card number has been stolen.

    Good call, Citi. Unfortunately for the OP, he lost his tax deduction.

  4. Mr. Gunn says:

    I never realize that about donations as validations. That’s interesting, but it seems like a call or email would have been in order nonetheless.

    acambras – WTF?

  5. acambras says:

    Grady — I refer to the Red Cross coming under fire for red tape, internal problems, and inability to work with local groups (particularly after Katrina). Those things have turned some people off from donating money to the Red Cross.

    Don’t get me wrong — I’m not trying to hate on the Red Cross. They’ll still get pints of my blood. I’m just pointing out that 9/11, Katrina, and the subsequent investigations into problems within the organization seem to have prompted some people to donate their money elsewhere.

  6. kimdog says:

    Acambras is referring to the fact that the American Red Cross has received criticism for its mishandling of funds from Katrina and 9/11. You can read about it here.
    There are better charities out there.

  7. Thanks for the mention. And yes, I understand that charitable donations are sometimes used (by scammers) as a way of testing whether or not a card is still active. But let’s not throw the baby out with the bath water! How hard would it be to flag the transaction, call to verify that it’s legit, and then cancel it (after the fact) if not. This is how Citi has always handled fraud prevention in the past.

    P.S. It’s fivecentnickel with an ‘EL’ not an ‘LE’.

  8. Good call, Citi.

    They didn’t call, that’s the problem.

    She also stated that they have hundreds of thousands of customers, and can’t be expected to stay in touch with all of them.

    Yes they can! If they can call Meghann when they are only asking about recent activity they can certainly call someone when they actually stop a charge. I find it hard to believe that there isn’t a way to automate that if they don’t have the people or time to make the phone call themselves.

    Furthermore, if it is their policy now to stop payments to charities due to fraud, they should inform their customers so that they can contact them before making legitimate donations or avoid using their credit card to do so altogether.

  9. This is a good reason why you shouldn’t wait until Dec 31st to make your donations if you want the tax deductions for this year. :) You never know what can happen…

  10. nweaver says:

    Also he doesn’t say the amount. I’d bet that it is a small dotation ($25-50 or so), as those seem to be the most commonly used-for-valiaditon amounts.

  11. gotbock says:

    Even if they do call you it’s not necessarily that helpful. I’ve gotten several recorded messages from card companies in the past when I had “risky” charges show up. They usually go to voicemail (since I’m not home during the day) and half the message will be cut off since their automated systems start the message when the line picks up, and not when the mail system starts recording. I end up with the end of a cryptic message with no number to call and no idea which company called. Great. Now I get to call all my card companies and see which one was so “concerned” about protecting my credit.

  12. No, I didn’t say an amount in my post. But it was relatively a large donation. Considerably larger than what you’d likely use if you were just testing out a card, which makes it all the more frustrating. If it was a small one, I wouldn’t really care about the tax implications.

  13. Argh. The comment system ate my last comment… Anwyay, no, I didn’t say an amount in my post. But it was a relatively large donation, much larger than you would typically use if you were just trying to test out a credit card with a non-descript purchase. That makes it all the more frustrating. If what just a small donation, I might be annoyed, but I wouldn’t really care about the tax implications.

  14. No, I didn’t say how much the donation was for in my original post. But it was relatively large — much larger than one might typically use when testing out a credit card with a non-descript charge. Hence my frustration about the tax implications.

  15. dickius says:

    Same thing happened to me. I made a bunch of charitable donations on my Juniper Bank credit card on 12/30 to get them in the ’06 tax year. About an hour later, I got a call from Juniper’s fraud unit, seeking to confirm that a donation I made to the Juvenile Diabetes Research Foundation was legit. I thought it was a little weird–now I get it.

  16. Dickius, at least Juniper called you.

  17. synergy says:

    I got a hold put on my bank card on Christmas Day because of something I goofed, but the bank immediately sent me an email to let me know. Good thing I checked my email before I headed out to make some purchases first thing the next morning.

  18. Papa K says:

    Capital One called me when I dropped a ton on furniture, on air line tickets, and started spending money in New York City – they always let the charges go through and confirmed with me that I was who I claimed to be.

    Honestly, I don’t mind. It’s nice to have someone tell you “are you sure you spent this much there on that?”