When you spot an unfamiliar charge on your credit card statement, you want to act fast. There’s no need to panic—federal law caps your liability at $50 for unauthorized charges to you credit cards (and you may not even have to pay that)—but to get your money back, you’ll need prove the charge was unauthorized through filing a formal dispute.
Initiating the dispute process with your credit card issuer allows you to contest charges and potentially get them removed from your bill. If you notice a suspicious transaction or believe you were unfairly charged, here’s how to deal with it.
Carefully review your credit card statement
The first thing to do is make sure the charge actually warrants a dispute. Sometimes, charges may appear under unfamiliar names or on a slightly different date than your purchase was actually made. Consider checking with family members or other authorized card users if you’re unsure about a specific charges. Make sure you recognize all the charges, check for duplicate charges, and verify that there is no pattern of unauthorized or fraudulent transactions that might suggest there’s more at play than a simple billing error.
Figure out who to call
Before initiating a formal dispute with your credit card issuer, consider contacting the merchant directly. It’s possible someone made a genuine mistake or can provide clarification that will resolve the issue promptly.
If you are unsuccessful at reaching the merchant, don’t receive a satisfactory answer, or you’ve confirmed the charge is not a mere billing error and is indeed fraudulent, then it’s time to initiate a formal dispute with your card issuer. A merchant can resolve a billing error, but will be little help if your card information itself has been compromised.
Gather evidence
If you are unable to resolve the issue with the merchant or suspect fraudulent activity, collect all relevant evidence related to the disputed charge. This evidence may include receipts, order confirmations, tracking information, emails, or any communication with the merchant—anything to strengthen your case during the dispute. If the charge is one you don’t recognize at all, check the bill for information—charges will typically indicate the location where the charge was made, a reference number, and/or a spending category description. Be ready to explain how these factors can help indicate this wasn’t a purchase you made.
Initiate the dispute process
Contact your credit card issuer’s customer service department as soon as possible to initiate the dispute process. You can find the customer service number on the back of your credit card or on the issuer’s website. Be prepared to provide the following information:
Your name and account number.The date and amount of the disputed charge.A brief explanation of why you are disputing the charge.Mention that you have already attempted to resolve the matter with the merchant (if applicable).Any evidence you have gathered.In the case of a fraudulent charge, your credit card issuer will likely issue you a new credit card number (sometimes immediately).
Consider filing a dispute letter
Though it’s often possible to initiate a dispute over the phone, it can be helpful to follow up with a written dispute letter to your credit card issuer, according to the Federal Trade Commission. The letter should include all the essential details mentioned during your phone call. More than anything else, this letter serves as a formal record of your dispute.
Request a temporary hold on payment
While your dispute is under investigation, you have the right to request a temporary hold on payment for the disputed amount. This ensures you won’t be required to pay the contested charge while the credit card issuer assesses the situation.
If your issuer doesn’t agree to a temporary hold, it’s best to pay off your balance as if the charge was legitimate. Hopefully you’ll get reimbursed; otherwise, you could be on the hook for not just the charge, but also any applicable late fees down the line.
Wait for a response
After filing your dispute, your credit card issuer will investigate the charge. The investigation process can take anywhere from a few days to several weeks, depending on the complexity of the case. During this time, the issuer will work with the merchant to resolve the dispute.
Once the investigation is complete, your credit card issuer will inform you of their decision in writing. If they find in your favor, the disputed amount will be removed from your statement, and you won’t be responsible for paying it. If the charge is deemed legitimate, you will be required to pay the amount, along with any applicable fees.
If you disagree with the investigation result or believe the decision was unjust, you have the right to appeal. Contact your credit card issuer again and provide additional evidence or arguments to support your case. The appeal process will involve another review, and the issuer will inform you of the final outcome.
Bottom line
Disputing a credit card charge can be a bit of a process, but it’s essential to protect your finances and maintain the integrity of your credit history. Be proactive, gather evidence, and communicate promptly with your credit card issuer to increase the chances of a successful resolution. Remember, maintaining a vigilant eye on your credit card transactions can help you identify and resolve issues early on.
