Understanding Your Rights After a Fraudulent Charge

What are your rights after a fraudulent charge?

A fraudulent charge — an unauthorized purchase or withdrawal on your credit or debit account — demands quick, organized action. Your rights differ depending on whether the charge is on a credit card (covered mainly by the Fair Credit Billing Act, FCBA) or a debit/electronic transfer (covered by the Electronic Fund Transfer Act, EFTA/Regulation E). Acting promptly preserves legal protections, increases the chance of a provisional credit, and shortens disruption to your finances.

In my practice helping individuals recover from fraud, the clearest pattern is this: consumers who report irregular charges immediately, document carefully, and follow their issuer’s dispute process get faster outcomes. Below I explain timelines, practical steps, and escalation paths (including when to involve law enforcement or the Consumer Financial Protection Bureau).

Key federal protections at a glance

• Credit cards (FCBA): Liability for unauthorized card use is generally limited to $50; many issuers waive this if you report promptly. You must send a written dispute within 60 days of the bill that first shows the error to preserve FCBA protections (see CFPB guidance).
• Debit cards/electronic transfers (EFTA/Reg E): Liability depends on how quickly you notify the bank. Report within 2 business days and your loss is limited to $50; within 60 days you could owe up to $500; after 60 days you may be fully liable for unauthorized EFTs. Financial institutions must investigate and usually resolve within 45 days (longer for new accounts or international transactions), with provisional credit often provided within 10 business days (see CFPB/FTC).

Authoritative resources: Consumer Financial Protection Bureau (CFPB), Federal Trade Commission (FTC), and IRS identity-theft guidance (for tax-related fraud) provide official timelines and complaint routes (CFPB: https://www.consumerfinance.gov/complaint/, FTC: https://www.ftc.gov/, IRS: https://www.irs.gov/).

Step-by-step actions to take immediately

1. Freeze or block the card/account

• Use your issuer’s app or phone line to freeze or cancel the compromised card immediately. This stops new unauthorized charges.

1. Contact your card issuer or bank right away

• Call the customer-service number on the back of the card or on your statement. Request an investigation and ask for a provisional credit if available. For credit-card disputes, you should also follow up in writing within 60 days of the statement that lists the charge to preserve FCBA rights.

1. Document everything

• Save dates, times, names of representatives, case or claim numbers, and screenshots of the transaction and messages. This record is crucial if you need to escalate.

1. File an identity-theft complaint when appropriate

• If the charge is part of identity theft, file a report at IdentityTheft.gov and get a recovery plan and an official report you can provide to banks and credit bureaus (FTC: https://www.identitytheft.gov/).

1. Consider lodging a police report

• For significant fraud or identity theft, file a local police report. Some banks ask for one before final reimbursement.

1. Check and freeze your credit reports

• Consider placing a fraud alert or credit freeze with Experian, TransUnion, and Equifax if identity theft is suspected.

1. Follow the issuer’s dispute process in writing when required

• For credit cards, send a written dispute if your issuer requires it or to preserve additional protections under the FCBA. Use certified mail or another trackable method.

What timelines should you expect from issuers?

• Credit card disputes (FCBA): You must notify the creditor in writing within 60 days of the first bill containing the unauthorized charge. The creditor generally must acknowledge your complaint within 30 days and resolve it within two billing cycles (but not more than 90 days) (CFPB guidance).

• Debit/EFT disputes (EFTA/Reg E): The financial institution generally must investigate and resolve your claim within 45 days, and in many cases must provisionally recredit your account within 10 business days while it completes its investigation. For new accounts, POS transactions, or foreign-initiated transfers, that period can be extended to 90 days (CFPB/Regulation E).

Note: Practical timing depends on the bank and whether you reported the fraud promptly. I’ve seen banks issue provisional credits within 24–48 hours when customers reported quickly via secure chat or phone.

Differences between disputing a charge and a chargeback

• Dispute: You notify your issuer that a billing error occurred; the issuer investigates. Disputes are the consumer’s formal, legal route under FCBA/EFTA.
• Chargeback: A card-network mechanism where a merchant’s acquirer is asked to reverse a transaction. Chargebacks are part of the dispute process but involve different timelines and merchant response steps.

Knowing both terms helps when talking to issuers—ask whether they are opening an investigation under FCBA/EFTA and whether they’ll issue provisional credit.

Documentation checklist (what to save)

• Account statements showing the disputed charge
• Receipts, order confirmations, or merchant communications
• Emails, screenshots, and web pages for the vendor implicated
• Case or claim numbers and contact details from your bank
• Police report number (if filed) and FTC identity-theft complaint confirmation

Keep a single folder (digital and/or physical) with all items; when I work with clients, a well-organized packet speeds communication and reduces follow-up friction with banks.

When to escalate

• After following the issuer’s dispute process, if you don’t get a timely resolution or provisional credit, escalate internally to a supervisor.
• File a complaint with the CFPB online (https://www.consumerfinance.gov/complaint/) if the issuer’s response is inadequate.
• If the fraud includes identity theft that affects taxes, visit the IRS identity-theft guidance pages and follow their recovery steps (https://www.irs.gov/). Many of my clients who also had tax-related identity issues found the IRS’s Identity Protection PIN useful once their cases were opened.

How fraud can affect your credit score

Unauthorized charges themselves typically don’t directly affect your credit score. However, if fraudsters take out accounts, or if unpaid unauthorized charges are reported as delinquencies before the fraud is resolved, your credit can be harmed. Prompt reporting and documentation help prevent this.

Practical tips that help speed recovery (from my experience)

• Use secure chat or the issuer’s app when available — it creates written evidence faster than phone calls.
• Request and save the issuer’s dispute/claim number immediately.
• If you have recurring charges you didn’t authorize (subscriptions), cancel them and ask the issuer to stop the recurring billing.
• When disputing with a merchant, keep copies of all communications; for large losses consider hiring a consumer attorney or a fraud-recovery service only after verifying credentials.

Sample short dispute checklist you can use right now

1. Freeze the card via app or phone.
2. Call issuer and report the unauthorized transaction; ask for a provisional credit.
3. File a complaint at IdentityTheft.gov if identity theft is suspected; print the recovery plan.
4. Send a written dispute to the creditor if the charge is on a credit card or if the issuer requires it.
5. Save and organize all documentation; follow up until the account is corrected.

Related reading on FinHelp

• Steps to Take After an Identity Theft Incident (for step-by-step recovery plans): https://finhelp.io/glossary/steps-to-take-after-an-identity-theft-incident/
• Identity Theft Response Plan for Financial Accounts (templates and monitoring tips): https://finhelp.io/glossary/identity-theft-response-plan-for-financial-accounts/

These pages expand on credit freezes, police reports, and tax-specific identity-theft issues.

Common mistakes to avoid

• Waiting to report: Longer delays can increase your liability and reduce the chance of getting provisional credit.
• Not documenting: Claims without records take longer and are harder to win.
• Assuming debit and credit protections are the same: They are not—debit rights are more time-sensitive.

Final notes and professional disclaimer

Fraud resolution can feel stressful, but federal protections exist to limit your liability and require investigations by card issuers and banks. In my experience, organized, prompt reporting and clear documentation are the most reliable predictors of a quick recovery.

This article is educational and not personalized legal or financial advice. For complex losses, large-dollar fraud, or if you encounter pushback from an issuer, consult a consumer attorney or financial professional. For filing complaints and further authoritative guidance, visit the CFPB (https://www.consumerfinance.gov/complaint/), FTC identity-theft resources (https://www.identitytheft.gov/), and IRS identity-theft pages (https://www.irs.gov/identity-theft).