Fighting Unauthorized Use of a Credit Card

HNWBusiness Law, Contract Law

By Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright, a Freehold, NJ Business and Contract Law Attorney

If you or a loved one has gotten charges on his or her credit card that you do not recognize, you are not alone.  Every day, many Americans look at their credit card statements and scratch their heads wondering when they made certain charges to their accounts.  Some credit card companies are proactively watching your account and flagging suspicious charges, asking whether or not you actually incurred those charges and restrain charging your account until the investigation into the charge is complete.  Fortunately, for those companies that are not so proactive, federal law provides certain protections for those who report these charges right away.  Remember, the worst thing you can do is say nothing and pay the charge because you think you are required to.  Notify your credit card company as soon as possible as soon as you see unauthorized charges on your account.

The first thing you should do when you see an unauthorized charge on your billing statement is to call up the credit card company and ask where the charge came from, indicating you will be disputing the charge.  The company has a set of procedures designed to deal with this situation.  They may freeze your credit card account, issue a new card, and review your other charges to make sure none of them are fraudulent.  At a minimum, the law requires you to write to the creditor at the address given for billing inquiries, and include your name, address, account number, and a description of the billing error.  If you write to the credit card company, by law the company must acknowledge your complaint, in writing, within 30 days after receiving it, and has two billing cycles (but not more than 90 days) after getting your letter to resolve the matter.  But I would encourage you to call the company first to report the incident so they can take immediate action to investigate.

THE FAIR CREDIT BILLING ACT also limits the loss you can have for each unauthorized use of a credit card.  If you report the charge within two business days of the date it is made, you will only be liable for up to $50 of the charge when your monthly statement comes due.  That limit goes up to $500 if the report occurs after 2 business days and less than 60 calendar days after the date the charge is made.  Once you pass 60 days, the law offers no limit to what you can be charged.  However, some credit card companies won’t charge you for the unauthorized use until their investigation is complete and a determination is made, so check with your credit card company to see their policy on what you are responsible for when the bill comes due.  But as the law teaches us, you have a right to dispute a charge with the credit card company if you did not incur that charge, and you should report the errant charge right away to minimize the amount you may have to pay for it.

For more information, I highly recommend you check out https://www.

To discuss your NJ Business and contract matter, please contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at  Please ask us about our video conferencing consultations if you are unable to come to our office.

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