I've heard various stories about unscrupulous business practices relating to recurring credit card payments, but this is a new one on me. I've been subscribing to Scientific American for a long time, and every May I've been making a $25 credit card payment to cover the coming year. This year I got a postcard from them saying that they would start making a recurring charge to my account every year. This, they say, is for my convenience and also has environmental benefits. To prevent the recurring payments from starting up, I had to call an 800 number on the postcard and opt out.

Is this legal in the US? Does anyone know of other magazines that do this and that can be named and shamed? Are there strategies for preventing this, other than scrupulously reading every piece of junk mail? If this is becoming common for magazine subscriptions, I guess I could make a practice of only paying for those by check. That, however, would obviate the purpose of the credit card, which is supposed to be convenience.

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  • Best thing you can do is to cancel your subscription citing this objectionable behavior as the cause. They will almost certainly call you to convince to stay at which point you can explain your problem. Depending on the answer you get you can decide to play their game or not – Hilmar Feb 27 '15 at 1:48
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    I object to these recurring auto-renews. I've recently made purchases through an online company, discountmags.com which specifically states 'no auto renew.' They sent a near-daily email with latest sales, but no issue renewing or using them to add to a current subscription. – JTP - Apologise to Monica Feb 27 '15 at 16:09

In 2010, the Restore Online Shoppers' Confidence Act was passed, which prohibited certain activities, most of which had to do with online sites sharing your CC info with third parties. However, the final part of the act deals with "negative option" marketing, which is basically what you're describing - "We will charge you unless you say no".

It requires three components to allow a negative option:

  • Clearly disclose all material terms.
  • Clear and unambiguous informed consent.
  • Provide a clear and simple option to cancel.

If you did not explicitly enroll in automatic payment, and made the initial purchase online (or made your most recent purchase online, I suspect) then it sounds like this was a violation of this act. On the other hand, the act isn't terribly careful about defining terms, and is really quite vague in a lot of places, so it's possible they would argue they are not using a 'negative option' scheme but instead simply charging your bill similar to how your phone company might use autopay.

If it was not online, then this probably doesn't apply. Instead, the FTC's rule on Negative Option with regard to sale of goods applies. Title 16 Part 425 covers this; this law is much less limiting as to what the marketer can do.

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You have a subscription that costs $25

They have the capabilities to get that $25 from the card on file if you had stopped paying for it, you re-upping the cost of the subscription was more of a courtesy. They would have considered pulling the $25 themselves or it may have gone to collections (or they could courteously ask if you wanted to resubscribe, what a concept)

The credit card processing agreements (with the credit card companies) and the FTC would handle such business practices, but "illegal" wouldn't be the word I would use. The FTC or Congress may have mandated that an easy "opt-out" number be associated with that kind of business practice, and left it at that.

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    I've reread this answer several times, and I'm not understanding it, especially the middle paragraph. I'm not sure if it was meant to be humorous or sarcastic, which might not come through clearly in an online context. Part of the answer makes it sound as though you might think that I had already incurred a debt to them. I had not. I have not yet received any issues of the magazine from them that I haven't already paid for. – Ben Crowell Feb 27 '15 at 2:10
  • On rereadning the answer again, it occurs to me that maybe you thought I had agreed to a recurring charge for the subscription. That's not the case. – Ben Crowell Feb 27 '15 at 2:23

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