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Using BillGuard to Protect Your Credit and Debit Cards Against Fraudulent Charges

Written by Nickel - 4 Comments

Using BillGuard to Protect Your Credit and Debit Cards

A couple months ago, I received an e-mail from a PR person telling me about a new service call BillGuard. I get tons of PR e-mail and, almost without fail, they go straight to the trash.

That being said, this one caught my eye and I filed it away for later investigation. Fast forward about a month and the e-mail resurfaced in my inbox. I decided to dig deeper and I must say that I’m pretty impressed with what I found.

BillGuard is a free (more on that later) service that scans your credit and debit card statements in search of deceptive or fraudulent charges. In essence, it’s a crowd-sourced fraud detection system that “gets smarter with each click.” When something questionable pops up, it alerts you and asks you if the transaction is legit.

Of course, if there’s something truly fraudulent on your bill, you’ll still need to follow up with your card issuer to straighten it out. But without BillGuard, you may not have discovered the problem in the first place.

To use BillGuard, you have to create an account and then grant them read-only access to your credit card statements. This may sound scary, but it’s in many ways similar to services like Mint.com, with seemingly solid security and good privacy policies. They’ve also raised significant venture capital, so this isn’t a fly-by-night operation.

As of this writing, BillGuard claims to have saved users over $630k, having found “bad charges” in roughly 20% of the accounts they’ve scanned. The system also identifies and lists things like credit card fees and recurring charges. As such, it can help you ferret out zombie charges and the like.

My first thought was wow, this sounds too good to be true. I wonder how they make their money? As it turns out, they had originally intended to offer BillGuard as a “freemium” service, with the first card being free and a monthly charge for additional cards.

They have since transitioned to a completely free (to users) business model. To generate revenue, they are licensing their platform to banks who can integrate the service into cardholder accounts. They are also accumulating massive amounts of valuable (but anonymized) data on spending patterns, fraudulent charges, etc.

While this latter aspect might bother some, I’m not particularly worried. Credit card companies, retail chains, etc. are already mining my data to better understand spending patterns and improve their marketing tactics. At least BillGuard offers a direct benefit in return for access to these same data.

To make a long story short, I signed up for the service, granted access to my accounts, and was pleased to see that there wasn’t any obviously fraudulent activity. Yes, I could do this by hand, but I get busy and sometimes don’t have time to review statements in a timely manner.

I will say that it tagged a few transactions as questionable, but a quick review revealed that these were all legit. For the most part, these were charges from local merchants for which they didn’t have enough info to render a verdict. I marked them as okay and expect them to pass muster the next time around.

Going forward, they scan your accounts on a monthly basis and send you an e-mail with the results. All in all, it’s a nice system that has the potential to save you from fraudulent charges.

Published on May 2nd, 2012
Modified on May 17th, 2012 - 4 Comments
Filed under: Banking, Credit Cards, Identity Theft

About the author: is the founder and editor-in-chief of this site. He's a thirty-something family man who has been writing about personal finance since 2005, and guess what? He's on Twitter!

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4 Responses to “Using BillGuard to Protect Your Credit and Debit Cards Against Fraudulent Charges”

  1. 1
    Rob Says:

    I am impressed. Like you, I am always skeptical, with special glaring red flags when someone wants my account info. But this sounds pretty good. I just cancelled out of Identity Guard since Consumer Reports showed they are expensive overkill and losses are limited to $50 anyway (and even that is usually waived if you notify card companies promptly).

    I will give this a try. Good find Nickel!

  2. 2
    Dan Says:

    I’d rather track every transaction myself with Mint. Plus, Mint does much more than simple alerts.

  3. 3
    Shawanda @ You Have More Than You Think Says:

    Sounds like a cool product. Almost without fail, when I review my credit card transactions, I find a couple expenses I don’t remember charging. It takes me a minute to recall what I bought. A few times, I’ve phoned the credit card company to obtain additional information regarding the related merchant. Fortunately, I haven’t found fraudulent charges on my accounts in years.

  4. 4
    BC Says:

    Pretty interesting. Just tried it. Its proactive rather than passive account gathering like a mint or yodlee. Since I use yodlee, this billguard was something extra to try.
    As of March 2013 – you get 3 credit cards to add. The rest are you pay to upgrade or refer a friend.
    Think I’ll just delete this account now. Too limiting.

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