If you’ve ever opened your credit card statement and saw charges that you didn’t make nor authorize, you know that sinking feeling and sense of dread. Then it occurs to you that you’re about to spend a lot of time on the phone with your credit card company and possibly others, too.
Before you brace yourself for those time consuming phone calls, take a look at a few of the changes, albeit minimal, in the dispute process for unauthorized purchases.
If you’re looking for the legal side of what to do, what you can expect and what your credit card company or bank is required to do, you can check the Truth in Lending Act and also the Fair Credit Billing Act. Either of these will help you understand the many ways you’re protected as a consumer. The better armed you are, the more likely you’ll get through it all with lower levels of frustration.
The Liability Factor
While most credit card companies offer a zero fraud protection, you should know that it’s not mandatory they do that. Federal laws limit your liability to $50 and the credit card networks can legally hold you to that. Those zero fraud protection perks are just that: perks and their purpose is to hopefully sway you into choosing their credit products. That said, a debit card is built a bit differently and if you’re not quick enough, you lose that $50 liability protection. Part of the Truth in Lending Act was designed to cover the unique debit card and if you don’t report it stolen or that it’s been used illegally within two days, you might be held liable for more than just $50.
Not What Was Advertised
Ever since “online shopping” was coined, there have been consumers who were misled and bought a service or goods thinking it would be as advertised, only to discover it was anything but. You can place those charges in sort of a “limbo” while you attempt to work the problems out with the seller. In those cases where a dispute can’t be resolved with the seller or merchant, the Fair Credit Billing Act kicks in to protect you.
Ah – but you must understand what it can, and more importantly, what it can’t do. First, the credit card purchase must equal $50 or more. And here’s where many online transactions fall away from qualifying for the intervention: the purchase must have been made either within 100 miles of your address or within your home state. There are special circumstances and if you contact your credit card company, there’s a better chance it will step in – but there’s a good chance, too, that it won’t.
From the moment you realize there’s a problem, you should begin documenting every conversation you have and keeping up with any relevant paperwork. This is important so that you can stay on top of things, especially when they’re date-sensitive. Now’s the time to pay attention to the little things, especially since you really don’t know how many other unauthorized charges have been made that you’ve yet to discover. It’s not uncommon for consumers to receive next month’s statement only to realize there are even more fraudulent charges.
Finally, the moment you realize there’s been illegal activity going on, you’ll want to call the credit card company immediately to request a new card. That’s the best first thing you can do to minimize the damage. Once you’ve come full circle and put your credit back together, you’ll want to do an internal audit, of sorts, of your own habits. From how you toss out credit card statements to obvious online passwords to how often you leave your information vulnerable – maybe you leave your handbag on your desk unattended or perhaps you are in the habit of leaving your wallet under the car seat.
With so many safeguards in place these days and credit card companies that are willing to do whatever it can to keep you – its customer – happy, the headaches that used to come with these types of problems have been minimized, but there’s no denying you must remain vigilant when it comes to your finances.