Credit Cards -- Did I Charge That?

CONSUMER ALERT

DANA NESSEL
ATTORNEY GENERAL

The Attorney General provides Consumer Alerts to inform the public of unfair, misleading, or deceptive business practices, and to provide information and guidance on other issues of concern. Consumer Alerts are not legal advice, legal authority, or a binding legal opinion from the Department of Attorney General.

CREDIT CARDS - Did I Charge That?

Complaints involving credit cards continue to be among the most common consumer complaints received by the Attorney General's Consumer Protection Division. Many of the problems can be avoided or resolved if they are recognized and addressed quickly. Here are some tips:

Guard your credit card information.

  • Armed with your credit card information, telemarketers or over-zealous vendors may place charges on your credit card that you have not authorized. In some instances, financial institutions or merchants with whom you do business may share credit card information with other companies selling various products and services, who in turn use this information to make unauthorized charges against the credit card account.  
  • Find out your credit card company's information sharing policy. "Opt out" of credit card contract terms that allow the card issuer to share your account information with third parties.
  • Don't provide credit card information over the phone unless you placed the call, especially to telemarketers or persons claiming to be from your bank or credit card company.
  • Don't provide credit card information as 'verification' or a means of identification.
  • Don't provide credit card information in exchange for a product or service that is to be provided on a 'trial basis.' Such offers may contain conditions, easily overlooked, that permit an automatic purchase to be charged to the credit card at the trial period's end.

Scrutinize your credit card bills every month for errors, especially charges for goods or services that you do not recognize.  

  • Don't pay for charges that you did not authorize!  Instead, notify your credit card issuer immediately upon discovery of the misuse.  Under Federal law, cardholder liability for unauthorized credit card use is limited to the lesser of $50.00 or the amount of money obtained by the unauthorized use before notification to the credit card issuer.

Read all the small print on credit card offers before agreeing to accept a new card.

  • Avoid surprise charges, fees, or disputes before they arise by reading all terms and conditions contained in a credit card application in full before you sign up. In particular;
    • Watch for mandatory "membership" or other fees that are automatically charged to the card if it is accepted.
    • If the card promotes a special introductory low finance rate, find out how long the low rate applies, and the amount of the finance rate after the introductory period has expired.
    • Be sure that the card does not include an automatic purchase of some other product, such as a magazine subscription, that will be automatically charged to the card if accepted. 
    • Avoid or opt out of contract terms providing for binding arbitration or information sharing with other companies.

Notify your credit card company in writing of disputes. 

To dispute a charge on your credit card bill, call the card company and let them know about the problem right away. In order to protect your rights you must also send a written billing error notice to the card company within 60 calendar days after the charge appeared on your statement. If you already paid the charge that you’re disputing, you can still dispute it. But you probably won’t get the money back until the credit card company has decided you were right. If the card company decides you are correct, the charge must be removed from your bill.  If the card company says that you are incorrect and the bill is correct, the card company must tell you why in writing.

Complaints about the quality of items paid for with a credit card may also be made by written dispute to the card company. If you’ve only paid part of a bill for the purchased item, you may have the right not to pay the remaining amount due on the purchase price. To be considered for this, all of the following generally must be true: (1) you must have first tried in good faith to resolve the issue with the seller; (2) you must have made the purchase in your home state or within 100 miles of your home address; (3) the price of the item was more than $50, and (4) you have not yet fully paid for the purchased item.