Fighting Unauthorized Charges: Working with Banks and Merchants

Quick overview

Unauthorized charges are transactions you didn’t approve — from a single fraudulent purchase to recurring subscription billing you never authorized. Acting promptly, documenting every contact, and using the right dispute channel (bank dispute, chargeback, or complaint to a regulator) are the most effective ways to recover funds.

Why timing matters: legal timelines and consumer protections

• Credit card billing errors and many unauthorized credit-card charges fall under the Fair Credit Billing Act (FCBA). Under the FCBA you generally must send a written dispute within 60 days of the date the issuer mailed the billing statement containing the error; the issuer must acknowledge your complaint within 30 days and investigate within 90 days. See the FTC summary of the FCBA for details (FTC).
• Debit-card and other electronic fund transfer disputes are covered by the Electronic Fund Transfer Act (EFTA) and Regulation E. Liability for unauthorized ATM or debit-card transactions is limited if you report a lost/stolen card within specific timeframes (e.g., within 2 business days to limit liability to $50; after 60 days you may lose protections). For more on electronic payment protections, consult CFPB guidance (CFPB).

Sources: FTC (Fair Credit Billing Act), CFPB (consumer guidance on disputes).

Step-by-step process I use with clients

1. Stop the bleeding immediately

• Freeze the card or account online and call your bank’s fraud line. Ask for a temporary block or card replacement.
• If charges are recurring, ask your issuer to stop future payments or issue a new card number.

1. Record the suspicious transactions

• Make a list with date, amount, merchant name as it appears on the statement, and any supporting notes (email confirmations, screenshots, subscription page). Store copies of emails, receipts, and screenshots in a single folder.

1. Contact the merchant — but don’t rely on it alone

• Email or call the merchant’s customer-service and request a refund, citing the unauthorized charge and attaching supporting screenshots. Note the representative’s name and time of the call.
• If the merchant acknowledges an error and issues a refund, get written confirmation.

1. File the dispute with your bank or card issuer

• Use the issuer’s fraud or dispute form online or call the fraud department. Follow up with a written dispute if required by the issuer. For credit-card billing errors, send a written notice within 60 days of the statement date containing the error (FCBA requirement).
• Keep records of the claim number and the name of every agent you speak with.

1. Send a clear written dispute (sample below)

• Even if you start online or by phone, follow up with a letter or secure message so there is a paper trail. Include:

  • Account number, statement date, the charge(s) in dispute (amount, date, merchant), and a short explanation that you did not authorize the transaction(s).
  • Copies (not originals) of receipts, emails, or screenshots.
  • A request for provisional credit while the issuer investigates (credit cards often provide provisional credit).

  Sample dispute letter (short):

[Your Name]
[Account number]
[Date]

To Whom It May Concern:
I am writing to dispute the billing error shown on my statement dated [statement date]. I did not authorize the transaction posted on [date] for [amount] with [merchant name]. I have attached copies of relevant documentation. Please investigate and remove this charge from my account and provide provisional credit per FCBA/Regulation E procedures. Please confirm receipt in writing.

6. Track deadlines and follow up

• Note the date you first reported the issue. If the issuer acknowledges the dispute, they must investigate within the regulatory timelines described above. If you don’t hear back in the expected window, escalate to their fraud supervisor.

6. Escalate if necessary

• If your bank or card issuer denies the dispute or doesn’t respond, file a complaint with the Consumer Financial Protection Bureau (CFPB) and consider contacting your state attorney general’s consumer protection office. For suspected identity theft, report it to the Federal Trade Commission at IdentityTheft.gov and consider filing a police report.

• CFPB consumer complaint page: https://www.consumerfinance.gov/ (search: disputing errors). FTC identity-theft resources: https://www.identitytheft.gov/.

6. Monitor credit and accounts

• Place a fraud alert or security freeze with the three major credit bureaus if you suspect identity theft. Review account statements weekly until the situation is resolved.

Chargebacks vs. bank disputes: which route?

• Chargeback: A process run by the card networks (Visa, Mastercard) that lets consumers dispute a merchant charge and seek reversal. Chargebacks are often faster for straightforward cases (fraud or goods not delivered) but can be contested by the merchant.
• Bank dispute: Filed with your card issuer; the issuer may pursue a chargeback on your behalf or resolve the issue internally.

If you want a deeper explanation of chargebacks and when to use them, see our guide “How Chargebacks Work: Rights and Risks for Consumers” (https://finhelp.io/glossary/how-chargebacks-work-rights-and-risks-for-consumers/) and “When to Seek a Chargeback vs a Bank Dispute” (https://finhelp.io/glossary/when-to-seek-a-chargeback-vs-a-bank-dispute/).

What if the merchant refuses or claims you authorized the charge?

• Provide your bank with any evidence that contradicts the merchant’s claim (delivery records, lack of account activity, email showing no subscription confirmation).
• If the merchant claims authorization, ask for their proof (signed receipt, IP address, login timestamp). Merchants are required by card network rules to provide evidence in a dispute.

Practical tips that improve success rates

• Act within the timelines — late disputes are the most common reason for denial.
• Save everything. A clearly organized evidence packet makes it easier for the bank to adjudicate quickly.
• Use real-time alerts. Transaction text/email alerts let you spot fraud immediately.
• When possible, request provisional credit (credit-card issuers commonly give this while they investigate).
• If recurring billing is involved, cancel the service directly after documenting the charge, then escalate to the issuer.

Advice for small-business owners and merchants

• Keep detailed transaction and fulfillment records (invoices, tracking, signed delivery receipts). These are your primary defenses in a chargeback or bank dispute.
• Respond promptly to chargeback requests with clear proof of delivery or customer authorization. Card networks enforce strict response windows.
• Use subscription management best practices: clear terms, easy cancellations, and email confirmations to reduce disputes.
• Consider working with a payment processor or chargeback mitigation service if you see high dispute rates.

Common mistakes to avoid

• Waiting too long to report a suspicious charge.
• Deleting emails or messages that could prove your case.
• Assuming the merchant will do the right thing without getting the bank involved.
• Ignoring follow-up requests from the bank’s fraud department.

When to involve regulators or law enforcement

• If the issuer refuses to correct an obvious unauthorized charge and you have strong documentation, file a complaint with the CFPB and your state attorney general.
• If you suspect identity theft (multiple accounts affected, false accounts opened), report the crime to local law enforcement and follow IdentityTheft.gov’s recovery plan.

Frequently asked practical questions

• Will I be charged a fee to dispute a charge? Most banks do not charge customers for filing a dispute; check your issuer’s terms.
• How long until I see money returned? Issuers often provide provisional credit within days but final resolution can take up to 90 days under FCBA/EFTA rules.
• Can I be held responsible? If you notified the bank promptly and the card wasn’t negligently handled, liability is usually limited.

Final checklist

• Freeze the card/account and replace card number if needed.
• Document the transaction and collect supporting evidence.
• Contact the merchant and request a refund in writing.
• File the dispute with your issuer and follow up with a written notice if required.
• Escalate to CFPB or state regulator if the bank is unresponsive.
• Monitor credit and consider a freeze if identity theft is suspected.

Authoritative resources and further reading

• Consumer Financial Protection Bureau: Disputing errors and consumer complaint portal — https://www.consumerfinance.gov/
• Federal Trade Commission: Fair Credit Billing Act — https://consumer.ftc.gov/articles/fair-credit-billing-act
• IdentityTheft.gov (FTC): report identity theft and get a recovery plan — https://www.identitytheft.gov/

Professional disclaimer: This article is educational and does not constitute legal or financial advice. For personalized assistance, consult a qualified attorney, financial advisor, or your card issuer’s fraud department.

Related FinHelp guides:

• How Chargebacks Work: Rights and Risks for Consumers — https://finhelp.io/glossary/how-chargebacks-work-rights-and-risks-for-consumers/
• When to Seek a Chargeback vs a Bank Dispute — https://finhelp.io/glossary/when-to-seek-a-chargeback-vs-a-bank-dispute/
• Steps to Take After an Unauthorized Credit Card Charge — https://finhelp.io/glossary/steps-to-take-after-an-unauthorized-credit-card-charge/