You check your statement and there it is: a charge you don’t recognize. It’s an unsettling moment — but here’s what most people don’t realize: US federal law gives you strong, specific protections, and if you act within the deadlines, you’ll almost certainly owe nothing. The catch is that those protections come with a hard 60-day clock, and the rules are dramatically different for credit cards versus debit cards. This guide walks you through exactly what to do, your rights under the law, and how to escalate if your bank doesn’t resolve it.
This is general educational information about US consumer protection law, not legal advice. For your specific situation, consider consulting an attorney.
First: what kind of charge is it?
Before disputing, identify which of three things you’re looking at — because the path differs:
- Fraud / unauthorized use — someone used your card without permission. This is the strongest protection category.
- A billing error — a real merchant transaction that went wrong: charged twice, wrong amount, goods never delivered, or a returned item never credited.
- A charge you actually authorized but don’t recognize — a forgotten free trial that converted, a subscription that renewed, or a merchant using an unfamiliar name on statements (this is very common).
Before you dispute, do two quick checks: search the merchant descriptor online (many businesses bill under a different trading name), and ask anyone else with a card on your account. Disputing a charge you genuinely made is called “friendly fraud,” and a pattern of it can get your account closed.
Your rights under US law
For credit cards, you’re protected by the Fair Credit Billing Act (FCBA) — a 1974 federal law that amends the Truth in Lending Act and applies to open-end credit accounts. It gives you four powerful rights:
- Your liability is capped at $50 for unauthorized charges. And you are not liable at all for charges made after you report the card lost or stolen.
- In practice, you’ll usually owe $0. Visa, Mastercard, and American Express all have zero-liability policies that go beyond the federal minimum, provided you used reasonable care and reported promptly. The $50 federal cap is your legal backstop.
- You have 60 days from the date the issuer sent the statement containing the charge to submit a written dispute.
- While the dispute is investigated, the issuer cannot collect the disputed amount, cannot charge interest on it, and cannot report you as delinquent to the credit bureaus.
The 60-day deadline is firm. Miss it and your issuer has no legal obligation to investigate — you’d be relying on their goodwill, which they don’t owe you.
Step by step: what to do
1. Contact your card issuer immediately. Call the number on the back of your card. Report the charge, and if you believe your card details were stolen, ask them to freeze or replace the card right away. Speed matters — for both the deadline and stopping further charges.
2. Follow up in writing. This is the step people skip, and it’s the one that actually triggers your full FCBA protections. A phone call alone may not be enough legally. Send a written dispute (many issuers have an online dispute form that satisfies this) within 60 days of the statement date, including:
- Your name and account number
- The date and dollar amount of the disputed charge
- A clear statement of why you believe it’s an error, and that you’re disputing it under the Fair Credit Billing Act
3. Keep records of everything. Save copies of your letter or form submission, note the date and time of every call and who you spoke to, and keep any confirmation numbers. If you ever need to escalate, this documentation is what makes your case.
4. Try the merchant too — for a billing error (wrong amount, duplicate charge, undelivered goods), contacting the merchant directly is often the fastest fix. For outright fraud, go to your issuer first.
5. If it looks like identity theft, take extra steps: report it at IdentityTheft.gov (the FTC’s official portal), check all three credit reports for other accounts opened in your name, and consider a fraud alert or credit freeze. (See our guide to reading your credit report.)
The timeline your bank must follow
The FCBA sets binding deadlines on the issuer, not just on you:
| Stage | Deadline |
|---|---|
| You submit your written dispute | Within 60 days of the statement date |
| Issuer must acknowledge your dispute | Within 30 days |
| Issuer must resolve the investigation | Within two billing cycles — no more than 90 days |
If the issuer fails to follow these procedures, it forfeits the right to collect the disputed amount (up to $50) — even if the charge later turns out to be valid. You may also be able to sue for damages plus twice the finance charge involved (a statutory range of $100 to $1,000). That’s a real consequence, and it’s why banks generally take these deadlines seriously.
Credit card vs. debit card: a crucial difference
This is the single most important thing in this guide, and most people don’t know it. The FCBA does not cover debit cards. Debit transactions fall under the Electronic Fund Transfer Act (EFTA) and Regulation E — and the protections are substantially weaker, with liability that grows the longer you wait:
| When you report it | Your maximum liability (debit) |
|---|---|
| Within 2 business days of learning of the loss/theft | $50 |
| After 2 business days, but within 60 days of the statement | $500 |
| More than 60 days after the statement was sent | Unlimited — you could lose everything taken |
Compare that to a credit card, where your liability is capped at $50 (usually $0 in practice) throughout the 60-day window.
There’s also a practical difference that matters enormously: with a credit card, the disputed money is the bank’s while it’s investigated. With a debit card, the money is already gone from your checking account — and you may wait days or weeks for provisional credit while your rent and bills still need paying.
The takeaway: for online purchases, travel, unfamiliar merchants, and large transactions, use a credit card. It’s not about rewards — it’s about which law protects you and whose money is at risk while things get sorted out.See how credit cards work for the full picture of what a card gives you.
If your bank denies the dispute
You are not out of options:
- Ask for the denial in writing, with the specific reason and the evidence they relied on. You’re entitled to an explanation.
- Appeal with more documentation — receipts, emails, delivery records, screenshots, anything that supports your version.
- File a complaint with the CFPB at consumerfinance.gov/complaint. The Consumer Financial Protection Bureau forwards complaints to the company and requires a response, and this often resolves cases that stalled at customer-service level. It’s free.
- Complain to the FTC at reportfraud.ftc.gov — the FTC enforces the FCBA.
- Consider legal advice if the amount is significant and you believe the issuer violated the FCBA’s procedures — the law provides for damages.
Most disputes never get this far. But knowing the escalation path — and mentioning the CFPB — often changes the tone of a stalled conversation.
How to reduce the risk
- Review your statements every month. The 60-day clock starts from the statement date, so catching things early is what preserves your rights.
- Turn on transaction alerts in your card’s app — many issuers can text or notify you for every charge.
- Use a credit card, not debit, for online and travel spending.
- Watch free trials. Note the conversion date in your calendar, and cancel before it bills if you don’t want it.
- Check your credit reports free weekly at AnnualCreditReport.com — unauthorized charges can be an early sign of wider identity theft.
Frequently asked questions
How long do I have to dispute a charge? Under the FCBA, 60 days from the date your issuer sent the statement containing the charge. This deadline is firm, so act as soon as you spot something.
Will I have to pay the unauthorized charge? Federal law caps your liability at $50 for credit cards, and the major networks’ zero-liability policies mean most cardholders pay nothing for confirmed fraud.
Does this apply to my debit card? No — debit cards are covered by the EFTA/Regulation E instead, with weaker protections that worsen the longer you wait ($50 within two business days, up to $500 within 60 days, and potentially unlimited after that).
Can my bank charge me interest on the disputed amount? No. While the dispute is under investigation, the issuer cannot collect the disputed amount or charge interest on it, and cannot report it as delinquent.
What if the charge is from a merchant I do recognize? That’s likely a billing error rather than fraud. Contact the merchant first — it’s often faster — but you still have FCBA dispute rights if they won’t fix it.
What if my bank ignores my dispute? File a complaint with the CFPB at consumerfinance.gov/complaint. An issuer that fails to follow FCBA procedures forfeits the right to collect the disputed amount (up to $50) and may face further liability.
The bottom line
An unauthorized charge is alarming, but the law is firmly on your side — if you act within 60 days. Call your issuer immediately, follow up in writing, keep records of everything, and know that your liability is capped at $50 (and usually $0 in practice) on a credit card. Remember the critical distinction: debit cards have far weaker protection, and the money leaves your account while you wait. If your bank stalls or denies a legitimate dispute, escalate to the CFPB — it’s free and it works. The most valuable habit of all is simply checking your statement every month, because your rights depend on that 60-day clock.
Related reading: Check for wider signs of fraud in our guide to how to read your credit report, and understand your card’s costs in how to calculate credit card APR.
Sources
- Federal Trade Commission — Using Credit Cards and Disputing Charges: https://consumer.ftc.gov/articles/using-credit-cards-and-disputing-charges
- Consumer Financial Protection Bureau — §1005.6 Liability of consumer for unauthorized transfers: https://www.consumerfinance.gov/rules-policy/regulations/1005/6/
- CFPB — Submit a complaint: https://www.consumerfinance.gov/complaint/
- Cornell Law School (Legal Information Institute) — Fair Credit Billing Act: https://www.law.cornell.edu/wex/fair_credit_billing_act_(fcba)
- FTC — IdentityTheft.gov: https://www.identitytheft.gov/
General educational information about US consumer protection law, not legal advice. Laws and issuer policies can change — verify current rules with the CFPB or FTC, and consult an attorney for your specific situation.
