Here’s a cautionary tale from a Consumerist reader whose credit card company
contacted his out-of-date phone number and got authorization for a $4000 spending spree. withdrew thousands of dollars from his bank account for a payment he had supposedly scheduled and then OK’d over the phone. The problem? He hadn’t scheduled it, that wasn’t him on the phone, and that wasn’t his phone number.
“Today my wife went to withdraw money from our bank account and noticed to her surprise that we were over $4000 overdrawn. We then went online to check our account and noticed that there was a large pending payment to our American Express card. We checked the Amex account online and saw the same payment listed there. But neither my wife nor I had authorized this payment. So we called American Express and thus began a descent into madness…
1. The first person my wife talks to at Amex says that she’ll have to open a billing inquiry and it could take up to six weeks to resolve. My wife said that was unacceptable and asked to speak to a supervisor.
2. The supervisor said that they called a number (they wouldn’t even tell us what number) associated with our account and that the person they spoke with authorized the payment. My wife said that neither of us had spoken to anyone and the supervisor said that he would pull the tape of the call and would call us back within the hour.
3. The customer service rep (not the supervisor) who called us back said that they had reviewed the call and related the transcript to us. It’s important to understand that my wife has an unusual first name that someone could take for being either a male or female name:
Amex Rep: Is this [my wife's name]?
Man at unknown phone number: “Yes, this is [my wife's name].
Amex Rep: Do you authorize a payment of $XXXX on your account?
Man: “Yes, you can take the money out of my bank account.”
Amex Rep: Would that be the account ending in xxxx?
Man: “Yes, that’s the account.”
Based on this crack display of identity verification, Amex says they would not be refunding the money. We said we would be putting a stop payment on the transaction and would be contacting a lawyer.
So, apparently if you have a phone number that used to belong to an Amex account holder and Amex calls you asking for payment, all that is required to authorize money be removed from that person’s bank account is to say “yes, that’s me” and “yes, that’s my account”. No verification of social security number. No asking what the last four digits of the bank account is. No “what’s your mother’s maiden name”.
My wife and I are outraged. It is unbelievable that Amex makes no attempt to verify that they are talking to the right person. Heck they could have even called our home phone number and if someone else (a babysitter, a mother—in-law, etc.) answered, all they would have to do is pretend to be one of us and they could authorize a payment!”
Be warned, folks. Pass on any address change and phone number updates to your bank, credit card issuers, direct debit recipients, etc., as soon as possible.
(Thanks to vslacks!)