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Warning: before traveling overseas, call your credit card company

September 5, 2007

Capital One gets high marks from tourists and travel experts like Arthur Frommer because it doesn’t charge the outrageous two percent foreign transaction fees that most other cards do. But if you have a Capital One card, you might want to call the company before you cross the border. Reader Jess Myers of Minneapolis didn’t — and soon found herself without a working card.

“We took our three children on a four-day, three-night trip to Ontario and Manitoba in early August,” she says. “We used our Capital One credit card a month in advance to reserve hotels in Thunder Bay, Dryden and Winnipeg, and planned on using the card all though our trip.”

That is, until the second day of their trip, when Myers tried to buy a sleeping bag at a discount store in Ontario, and the card was turned down.

“I paid cash and I called Capital One as soon as we got to out hotel,” she says. “The customer service rep — with a limited command of English — checked my account and told me that there was no problem with my card, it was just the card reader at the store malfunctioning. I told him I was traveling in Canada and wanted to make sure there was definitely no problem, and was again told that ‘sometimes Canadian card readers don’t work well’.”

And how. Two days later, while trying to pay for gas in Winnipeg, the card was rejected again.

When Myers returned to Minnesota, she got a surprise call from her cell phone carrier saying that her bill couldn’t be paid by credit card. “Then I realized there was a real problem,” she says.

Myers called Capital One again and found her way to the fraud department, where a representative gave her the bad news: “He said because I didn’t call them 10 days in advance to let them know I would be traveling in a foreign country, they had shut down the account,” says Myers.

“When I asked if they could show me the documentation on their Web site or elsewhere of where they specifically inform cardholders of the ‘call 10 days in advance’ rule, they could not,” she recalls.

I could not either, so I contact the company to find out if it routinely canceled cards being used overseas, or if this was just an isolated case of their fraud-detection algorithms working overtime.

“We encourage all customers to contact us prior to traveling internationally,” spokeswoman Pam Girardo told me. “We will set a travel notification flag on their account that allows us to better serve them when they are making purchases internationally.”

What if they don’t phone Capital One? “They may be unnecessarily inconvenienced with a point-of-sale decline,” she said.

“However, it is not our practice to automatically decline all international purchases if you have not contacted us prior to traveling,” says Girardo.

My advice? No matter which credit card you use, it seems prudent that you let your card issuer know of your travel plans well in advance. That’s especially true if you’re going on vacation with a Capital One card.

Christopher Elliott is the author of Scammed: How to Save Your Money and Find Better Service in a World of Schemes, Swindles, and Shady Deals. Critics have called it “eye-opening” and “inspiring” — it’ll “grab your attention and won’t let go.” Order your copy now on Amazon, Barnes & Noble or iTunes.

22 comments

  • Caryl Kauffman

    This happened with my non-Capital One card as well, only it happened before I ever left the country. I booked an apartment in Scotland through an agency, and the deposit wouldn’t go through because it got flagged by the credit card company. A quick call resolved it, and also let me know to alert the company before my upcoming trip. But I would never have thought to do that in advance and had never seen or heard about problems with traveling out of the country. Is this a new thing? It didn’t happen when we went to Italy in 2004.

  • Dave

    I agree to call ahead whenever you’re going to use a car internationally. I did this with three cards prior to a recent trip. For two of them, it was a matter of a minute or two and all was settled. For Capital One, you call the “customer service” number, wait on hold for a few minutes, talk to the operator, get transferred to the “fraud” office, wait on hold a few minutes more, then finally talk to someone who puts a flag on the account. After they did this, I tried the next day to reserve a local bus trip, and it was declined. I called again, went through the same gauntlet, then was told that my account said I could use that card in that country as of the dates I had told them. As though they had never heard there’s an Internet and it it’s possible to make travel arrangements in advance now. Twice while traveling, Capital One has denied charges, even though I did call in advance. Yes it is nice that they don’t charge the 2-3% ripoff fee, but it’s a real hassle to use Capital One overseas. I would never take that card along without having another one in my pocket as well.

  • http://ChristopherElliot JON

    As with David, I too have had some problems with Capital One’s “Internatioanl Travel Flag”. Through trial and error, however, I discovered that one needs to wait more than a single day (or 2), before attempting online international deposits/reservations, using the Capital One card. Capital One requests 10 days’ advance notice, and from my experience, they really mean it. On most occasions, when planning for trips into Canada, I wait the 10 days to use my Capital One card internationally, and then my Capital One card is readily accepted for online reservations. As for travel itself: using the advance notice of 10 days, I’ve had no problems using Capital One in Canada or Mexico. Also, as David recommends: always carry another “brand” of credit card… just in case.

  • Vicki

    Just a note re: notifying credit card companies before traveling outside of the U.S. I had a similr experience a number of years ago with Citibank. I was in France and at the time it was the only credit card I owned. Since then, I notify them whenever I will be traveling to several destinations in a short period of time (even domestically) so as not to put a red flag on my account. Citibank is very vigilant- a good thing in my opinion. May I also add that it is a good idea to notify your credit card company prior to making a large purchase, as that will also set off the “fraud alarm” if that type of activity is not usual for the cardholder. It doesn’t take much time and saves a whole lot of hassles later on!

  • kiwin

    Citibank starts the “decline when traveling” dance every few months… must have done it 10 times. I travel internationally almost every month and each time I tell them to check my history. They always say to call in advance. I always tell them I will be traveling internationally every month for the next year. Citibank has the worst customer service but has many exclusive deals on airline loyalty cards. I think it is a scam by Citibank to get customer to pay the outrageous monthly “fraud protection service” fees.

  • Kathleen

    I had a different problem with Capital One. I phoned to ask if I could get a new card within a week because I was leaving for Europe on the eighth day. I was told yes, of course, if I applied via the Web. So I applied through the Web site. At the end of the application I was told that I had been approved but that the card would arrive in 7-10 *business* days. I phoned immediately and was told that nothing could be done until a number was assigned; I was to call back each day to see when that would be. On the fourth day a supervisor said that the card would be expedited to arrive on Thursday before I left Friday morning. It did not appear. Thursday night the rep said that she could not reroute the card to Europe, but that if I would call upon arrival an “emergency card” would be delivered within 24 hours and the first one cancelled. I called five minutes after checking in on Saturday morning. The new answer was that the card could not be delivered on Sunday but would definitely be at my hotel Monday. It was not. Capital One would not give the number of the card to the hotel desk so that I could charge my stay as promised. I still do not have a card. We will see whether the latest promise, to have the emergency card delivered to Stockholm today, has been kept–I will arrive in a few hours.

    As for traveling abroad, I always tell my personal banker at Bank of America when I will be using my Visa out of the U.S., but I try not to use it because BofA slaps a 3% surcharge on purchases in other currencies. When BofA bought MBNA, they started the same ripoff on my MasterCard (which I have now canceled). That’s why I wanted a Capital One account.

  • Paulette Baker

    I just returned from two weeks in Canada. I used my Capital One almost exclusively on the trip because it doesn’t charge the foreign transaction fee. I didn’t call Capital One first, and I had no problems charging nearly $4,000, including accommodations, on this trip. I also used my American Express for one purchase — also without question or problem. Maybe I didn’t have a problem because I frequently make foreign purchases from home; maybe I’ve just been lucky. In fact, I’ve never called ahead and never had a problem using any of my cards in Canada, Bermuda, or Australia. I think I’ll call ahead from now on, though, just in case.

  • Victoria

    This happened to a friend of mine. Be careful because many banks won’t send a new card to the location you are, only to home. After I heard that story I started calling our credit card company before we left (Chase Bank). I was told that when overseas charges come up they check your account to see if you also purchased plane tickets to that location. I note that my credit card statement will always show name of airline, destination city and name of passenger for each ticket I buy. Chase said that if it did not see such information on a past transaction then it will decline overseas charges. (Or if you flew to Paris and the charges were from China). So, if you use different credit cards, used miles or someone else bought the ticket for you, it is best to call the bank before you leave.

  • Zane Greene

    I live in Scottsdale Az and spent 2 months in Vancouver BC. I used my Capital One credit card extensively and exclusively. It was never refused or turned down.

  • http://ellitott Kenda K.

    Fortunately I have had no problem using my Capitol One Visa card in Europe. AND, the plus of having no “foreign transaction fee” assessed was a huge bonus. My husband used our Bank of America Platinum Plus Visa during the same trip and not only was the “fee” added to our bill, but ALSO a “Finance Charge” of 35.96% immediately imposed on our bill! The normal variable rate was 13.99%.
    We plan on canceling this card a.s.a.p. and had told this to a customer service rep. They made no offer of refunding the extra finance charges to try to keep us as good customers.
    About the “flagging” of purchases, if you paid for the airfare with this same card, wouldn’t that be an obvious “clue” as to any foreign purchase?

  • Kay C-S

    My husband experienced a similar problem with Capitol One this summer when he went to Mexico. When he could not use his card for a purchase, he e-mailed me to see if I could call and find out what the problem was. I called Customer Service, who referred me to Fraud. I couldn’t do anything about it, but they were gracious enough to provide an international toll-free number for my husband to call. It was straightened out in one day (thank goodness).

  • Sheila

    I haven’t had any problems with Visa. What does Capital One do when you buy something over the phone (or Web) from Canada, while you are in the States?

  • Richard

    We had an odd experience when we purchased a cruise from Oceania Cruises. Although we made the transaction with their offices in Miami, to cut its processing expenses, apparently Oceania outsources their credit card operations to an outside firm. Consequently, when the transaction was processed, it came across as a foreign transaction and the aforementioned credit card company automatically assessed a 3% foreign transaction fee, even though the charge was made in US dollars by a US company and the credit card company performed NO currency conversion whatsoever.

    I’m surprised Capital One approved a $10,000 “foreign” transaction without first giving me a call or raising a red flag! But then again, they stood to clear an easy 3% profit from me on the deal (plus whatever additional fees they charged the merchant!)

    By the way, American Express also offers a straight 2% conversion fee and does not tack on an additional foreign transaction fee. Furthermore, AmEx Platinum card holders can exchange US currency at any overseas AmEx branch office without paying a conversion fee. So if you’re planning to travel abroad, I’d strongly recommend making AmEx your primary or secondary credit card. (Don’t worry about the higher annual fees – there are plenty of promotions offering fee-free AmEx cards for your first year).

  • Amy

    My father lives overseas four months a year (in Paris) – and has for years now – and has found that Capital One is the best to use overseas because of the foreign transaction/fee issue, BUT they are still a pain in the butt to deal with when there’s a problem. He ALWAYS calls about 10 days-2 weeks before he’s leaving, and they still always manage to screw him up while he’s gone – stopping the card at some point every single trip. Because he goes for two months at a time, it’s too long for them to put into their computers and keep that not active for the entire time. Also, inevitably there’s always some sort of bogus problem where they stop the card, and he gets furious, making me deal with them. I do, and he’s even had to call from overseas numerous times which is not easy to do. It’s such a problem. While they say one thing, they really do another. I have a feeling that all of the cards are bad about this though. It just seems that Capital One has taken this to new heights since that’s the one that always seems to have the huge problems. I have literally spent (documented) hours on the phone trying to deal with multiple people each time, and it’s such a nightmare! The right hand does not talk to the left hand at that company. If it weren’t for their feeless foreign transactions, we would have stopped using them a long time ago.

  • Ken

    Here’s another situation where it helps to call the CC company in advance: I sometimes go on 2-5 day motorcycle trips. Most motorcycles have a range of 200-300 miles between fill ups. To the CC fraud department, it looks like numerous gas purchases outside the home area. Citibank locked my card once, but a quick call to their 800 number cleared things up. Since then, I’ve always called in advance and never had a problem.

  • http://shanonssemsterabroad.com Shanon

    I had a bad experience a couple months ago, when going to france for a semester abroad. I got to the currenvy booth and my card was rejected. I then went to the atm, where it not only rejected a withdrawl, but actually retained my card. I freaked out because i was now broke and alone in a foreign country. I was able to get a new card, but that took 2 weeks and by then i has wired the money to a new account in france.

  • Karen

    Capital One did that to me when I was visiting Seattle (I live in Canada), since then I’ve learned to call in advance as they’ve requested.

  • http://cheapdanny.blogspot.com danny

    Wow.. I’ll definitely be calling my credit cards companies before my vacation. Great read and very informative! Thanks Elliott!

  • $0.36

    You mean the $0.36 on a $100 spent fraud protection.

    It does not protect me at all!

    So for online transactions I use Amex Charge Cards. These have fraud protection. You pay maximum $50, only. Even if the fraud was $1000 before you had a chance to call them.

    Thank you Amex. You’re a godsend!

  • http://N/A T. F. STOCK

    Capital One’s Travel Notification Policy applies to domestic as well as international travel. I live in a Mid-Atlantic state and have had charges declined in New York City.

    Despite repeated requests, they have yet to provide me with a written statement of their policy beyond a form letter that reads:

    “Please be informed that for security purposes we urge all our customers to inform Capital One about their travel to cities within or outside USA. This policy that Capital One has is to ensure that we keep a close watch ion your account with us.”

    Note that the letter says nothing about declining charges.

    My only defense seems to be to have a standing notice that I may be travelling to another US city and a separate notice when I plan to travel abroad.

  • Pingback: 7 Things To Know About Using Credit Cards During International Travel | Credit Card Assist Blog

  • Tony

    I just saw your blog. Nice advice/information. This summer, I went twice to Germany and Czech Republic — used travelers checks. I felt I got ripped off by those changing places in Germany and Prague. It seems the Prague change stations are controlled by some Mafia — they advertise no change fee to bring the travelers in and then give you real low rates. Some even advertise good rates of exchange and slam you with extremely high fees. I had to walk out of many of those after demanding the final amount after their fees.

    Strangely, in Perth, Australia, I got best service and rate at a regular bank. Why the European banks do not want to deal with money changing?

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