Action 9 investigates mobile credit card reader

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A Seminole County woman feels she has been burned by the latest credit card technology. When she paid $70 for a cab ride, her credit card was hit with a $700 charge.

A woman named Danielle, who didn't want her last name used in our story, took a 20-minute cab ride and paid the driver $70 with a credit card. He swiped it on a Square reader attached to his iPhone.

"He just kept saying, 'It's having problems. It's having problems,'" said Danielle. "I stood there waiting five minutes."

The driver said it then went through without a signature or emailed receipt.

Days later, Danielle said she discovered the cab charge had soared from $70 to $700.

"I got screwed or somebody made a bad mistake," she said.

Danielle disputed the charge with her bank but was turned down because it said she had signed the screen.

"I didn't sign anything that evening," she said.

There are many online complaints about Square readers and fraud. The device is used at food trucks to art shows to flea markets.

But unlike traditional card accounts, anyone can buy a Square reader, plug it in and sign up to process credit cards.

Critics said there's no screening process to eliminate risky business accounts and people with a history of fraud.

"From a cardholder standpoint, you don't know who you're handing your card to. There are no checks and balances," said Ben Dwyer of CardFellow.com.

Critics also say that without receipts, disputing charges can be tough.

Square told Action 9 it constantly monitors for fraudulent activity and takes action to shut down those users.

That doesn't ease Danielle's concerns.

Since contacting Action 9, Danielle's bank has agreed to reopen the investigation.

Security experts said always ask for an e-mail receipt and avoid Square when the merchant can't be easily checked out.