The 'Mean Girls' actress is said to have attempted to make a purchase worth $300 at the Rag & Bone shop on Mercer Street in Soho, New York over the weekend, but was left red faced when the store wouldn't accept her cards.
A source told the New York Post newspaper: "Lindsay was trying to buy something for around $300 but her credit cards were declined. She looked really embarrassed and tried to negotiate before her friend finally stepped in and paid."
A representative for the 27-year-old star - who is said to be so strapped for cash that the production company behind her reality show on Oprah Winfrey's OWN network had to pay the security deposit and rent for her apartment - denied the reports as "completely false."
The news of her cards being rejected comes just hours after it was reported that she had parted ways with her personal assistant Matt Harrell because she couldn't afford to pay his wages.
A source said: "Lindsay would love to have Matt back as her assistant, but she just can't afford him. He did a really good job for her."