$12.5B
FTC-reported fraud losses in 2024
FTC says consumers reported losing $12.5 billion to fraud in 2024.
warranty renewal auto-charge scam
Companies enroll consumers in recurring warranty plans with hidden auto-renewal clauses, making it extremely difficult to cancel and continuing to charge credit cards after the coverage period.
“extended warranty scam”
↑ 284%Key indicators
Usually targetsCar owners
Often hitsFreelancers and contractors
Common regionUnited States
Last updated2026-04-04
Estimated impact
$960
median reported loss
Typical range$60 – $6.0K
Recovery rate~15%
Scam breakdown
1
Consumers purchase what they believe is a one-time warranty and unknowingly agree to auto-renewal in the fine print
2
The company makes cancellation deliberately difficult with limited phone hours, long hold times, and requirements for written cancellation letters
3
Monthly or annual charges continue on the victim credit card even after verbal cancellation requests
What to do first
Read all warranty contract terms for auto-renewal clauses before providing payment information
Related terms
auto-renew warranty traprecurring warranty charge scamwarranty cancellation runaroundWarranty scamsEmailRisingCar ownersConsumersHomeownersFreelancers and contractorsSmall business ownersPayroll, HR, and finance teamsUnited Statesauto-renew warranty traprecurring warranty charge scam
Real-world example
How this scam plays out in practice
Based on reported patterns. Names and details are illustrative.
The setup
Emily, 35, a car owners, encountered what appeared to be a legitimate warranty scams situation while using Email. Consumers purchase what they believe is a one-time warranty and unknowingly agree to auto-renewal in the fine print
Step 2
What happened next was calculated: The company makes cancellation deliberately difficult with limited phone hours, long hold times, and requirements for written cancellation letters
Step 3
The pressure escalated quickly: Monthly or annual charges continue on the victim credit card even after verbal cancellation requests
The outcome
Emily realized something was wrong when warranty contract includes auto-renewal buried deep in the terms and conditions. By that point, significant damage had already been done — money sent, personal information shared, or trust exploited.
The lesson
Read all warranty contract terms for auto-renewal clauses before providing payment information Emily's experience shows why warranty contract includes auto-renewal buried deep in the terms and conditions and cancellation requires calling a specific number during limited business hours with long hold times are the clearest early warning signs.
How to identify it
- Warranty contract includes auto-renewal buried deep in the terms and conditions
- Cancellation requires calling a specific number during limited business hours with long hold times
- Credit card continues to be charged months after you requested cancellation
- Pause before paying, clicking, or sharing information. Scammers rely on speed.
- Verify the sender, company, or agency using a phone number or website you already know is legitimate.
- Treat secrecy, urgency, and off-platform payment requests as strong scam signals.
What to do now
- ✓Read all warranty contract terms for auto-renewal clauses before providing payment information
- ✓If unable to cancel through the company, contact your credit card issuer to block future charges and dispute unauthorized ones
- ✓File complaints with the FTC, CFPB, and your state attorney general office
What to save before reporting
- ✓Save the message, profile, phone number, email, or URL that was used.
- ✓Keep payment confirmations, receipts, and account alerts before you dispute or delete anything.
- ✓Write down the timeline while the details are still fresh.
- ✓Keep the full sender address, domain, attachments, and—if possible—the raw email headers.
How big is this problem
You are not alone — this scam affects millions of people.
These numbers come from government agencies and official reports. If you have been affected, know that this is a widespread problem — not something that only happens to careless people.
FTC 2024 fraud losses
Imposters
Most common FTC fraud category in 2024
FTC says imposter scams remained the most commonly reported fraud category in 2024.
History and evolution
- This scam family tends to persist because the social-engineering pressure works even when the exact scripts, platforms, and payment methods change.
- The specific packaging evolves over time, but the core pattern usually stays the same: create urgency, control the channel, and push action before verification.
- The CFPB has received numerous complaints about recurring charges for warranty and service contracts that consumers were unable to cancel despite multiple attempts
Recovery and follow-up
- ✓Save the messages, receipts, account alerts, and transaction details before you block or delete anything.
- ✓Report the scam through the official platform or government channel that best matches where it happened.
- ✓Read all warranty contract terms for auto-renewal clauses before providing payment information
- ✓If unable to cancel through the company, contact your credit card issuer to block future charges and dispute unauthorized ones
- ✓File complaints with the FTC, CFPB, and your state attorney general office
Why this pattern keeps working
Even when the story changes, most scams still use the same pressure pattern: urgency, authority, and a request to move money or data fast.
The CFPB has received numerous complaints about recurring charges for warranty and service contracts that consumers were unable to cancel despite multiple attempts
OpenScam research
Where to report it
If you have been targeted by this scam, reporting it helps authorities track the pattern and protect others. United States has dedicated agencies that handle fraud reports.
ReportFraud.gov
Federal Trade Commission
Central U.S. consumer fraud reporting portal.
File an IC3 complaint
FBI Internet Crime Complaint Center
FBI portal for internet-enabled crime reports.
Start identity theft recovery
IdentityTheft.gov
Official U.S. identity theft recovery plan builder.
Explore further
Understand the bigger picture
Who is most at risk
Who this scam targets
Primary targets
Car owners, Consumers, Homeowners
Geographic concentration
United States
Primary channel
Email — Warranty scams
Why this group is vulnerable
Car owners are particularly vulnerable because this scam exploits trust in familiar brands, authority figures, and time-sensitive decisions. The growing number of reports suggests that awareness among this demographic remains low.
Sources and methodology
How we verify this information
OpenScam tracks scam patterns using a combination of government consumer protection databases (FTC, IC3, Action Fraud), platform-specific fraud reports, and verified consumer complaint data. Each entry is cross-referenced against at least two independent sources before publication.
Severity ratings are based on financial impact potential, reversibility of damage, and volume of reports across multiple reporting channels. Trend velocity reflects the rate of change in report volume over the most recent 90-day window.
This page was last verified on 2026-04-04. Red flags, recovery steps, and reporting resources are reviewed quarterly against current agency guidance.
Evidence and indicators
- The CFPB has received numerous complaints about recurring charges for warranty and service contracts that consumers were unable to cancel despite multiple attempts
Source notes
- OpenScam research
Frequently asked questions
Common questions about warranty renewal auto-charge scam
How does the warranty renewal auto-charge scam work?+
Consumers purchase what they believe is a one-time warranty and unknowingly agree to auto-renewal in the fine print The company makes cancellation deliberately difficult with limited phone hours, long hold times, and requirements for written cancellation letters Monthly or annual charges continue on the victim credit card even after verbal cancellation requests
What are the warning signs of warranty renewal auto-charge scam?+
Warranty contract includes auto-renewal buried deep in the terms and conditions Cancellation requires calling a specific number during limited business hours with long hold times Credit card continues to be charged months after you requested cancellation
What should I do if I encounter warranty renewal auto-charge scam?+
Read all warranty contract terms for auto-renewal clauses before providing payment information If unable to cancel through the company, contact your credit card issuer to block future charges and dispute unauthorized ones File complaints with the FTC, CFPB, and your state attorney general office
Who is most at risk for warranty renewal auto-charge scam?+
This scam primarily targets Car owners, Consumers, Homeowners. It is most commonly reported in United States and typically appears on Email.
Is warranty renewal auto-charge scam on the rise?+
warranty renewal auto-charge scam is currently on the rise with growing reports. It has been reported across US. Last updated 2026-04-04.
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Help someone avoid this scam.
Scammers succeed because people do not talk about it. If you or someone you know has been affected, there is no shame in it — it happens to millions of people every year. Share this page with friends and family so they know what to look for.
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