How to Report Unauthorized Charges on Your Credit Card

Quick answer

• Act immediately when you spot an unauthorized charge.
• Contact your credit card issuer directly, not the merchant.
• Review your recent transactions carefully for any unfamiliar items.
• Understand your liability limits for fraudulent activity.
• Keep records of all communications and documentation.
• Dispute the charge formally through your card issuer’s process.

What to check first (before you act)

Credit report accuracy

Before disputing anything, it’s wise to ensure your credit reports accurately reflect your account activity. Mistakes can happen, and sometimes what looks like an unauthorized charge might be a legitimate transaction you’ve forgotten or a billing error.

• What to do: Obtain free copies of your credit reports from AnnualCreditReport.com. Review them for any accounts or transactions you don’t recognize.
• What “good” looks like: Your credit reports accurately list all your accounts and their recent activity.
• Common mistake and how to avoid it: Assuming every unfamiliar charge is fraud without verifying. Always check your statements and reports thoroughly before taking action.

Utilization and balances

While not directly related to reporting fraud, understanding your overall credit utilization and balances is part of good financial hygiene. High utilization can negatively impact your credit score. If you’re dealing with fraud, it’s even more important to know what your legitimate balances should be.

• What to do: Note the balance on the disputed card and your overall credit utilization across all your credit accounts.
• What “good” looks like: Low credit utilization (ideally below 30%) across all your credit cards.
• Common mistake and how to avoid it: Ignoring your overall credit health while focusing on a single fraudulent charge. A comprehensive view helps manage your financial standing.

Payment history

Your payment history is a critical component of your credit score. If unauthorized charges lead to missed payments or late fees on your account, it can damage your credit.

• What to do: Confirm that all your payments are up-to-date and that no legitimate payments were misapplied or missed due to the fraudulent activity.
• What “good” looks like: A consistent record of on-time payments for all your credit accounts.
• Common mistake and how to avoid it: Letting a fraudulent charge go unreported, which might lead to missed payments and a hit to your credit score.

Recent inquiries

Unusual activity or multiple new accounts opened fraudulently could result in numerous credit inquiries on your report, which can slightly lower your score.

• What to do: Check your credit reports for any recent inquiries you didn’t authorize.
• What “good” looks like: A credit report with only inquiries you initiated for legitimate credit applications.
• Common mistake and how to avoid it: Not checking for unauthorized inquiries, which could indicate a broader identity theft issue beyond just one charge.

Time horizon

The speed at which you act is crucial when reporting unauthorized charges. There are often time limits for disputing transactions, and the sooner you report, the better your chances of a swift resolution and minimal impact.

• What to do: Note the date you discovered the unauthorized charge and the date you plan to contact your card issuer.
• What “good” looks like: Reporting the unauthorized charge within a few days of discovery.
• Common mistake and how to avoid it: Waiting too long to report. Many card issuers have specific timeframes for disputes, and delays can weaken your claim.

Step-by-step (how to report fraudulent charges)

1. Review your credit card statement immediately.

• What to do: Carefully examine your latest credit card statement and any recent online transaction history. Look for any charges that you or an authorized user did not make.
• What “good” looks like: You’ve identified one or more specific charges that are clearly unauthorized.
• Common mistake and how to avoid it: Glancing over statements and missing smaller fraudulent charges. Make it a habit to review statements thoroughly each month.

2. Gather necessary information.

• What to do: Have your credit card number, the date of the statement, and the exact details of the unauthorized charges (date, merchant name, amount) ready.
• What “good” looks like: You have all the specific transaction details for each fraudulent charge.
• Common mistake and how to avoid it: Not having the precise details of the charge. This can slow down the dispute process.

3. Contact your credit card issuer directly.

• What to do: Call the customer service number on the back of your credit card or your billing statement. Do NOT contact the merchant listed on the charge.
• What “good” looks like: You are speaking with a representative from your credit card company.
• Common mistake and how to avoid it: Contacting the merchant instead of the card issuer. The issuer is responsible for investigating and resolving disputes.

4. Inform the issuer about the unauthorized charges.

• What to do: Clearly state that you have discovered fraudulent or unauthorized charges on your account and wish to dispute them.
• What “good” looks like: The issuer representative understands you are reporting fraud and initiates the dispute process.
• Common mistake and how to avoid it: Being vague about the situation. Be direct and use terms like “unauthorized” or “fraudulent.”

5. Follow the issuer’s dispute procedure.

• What to do: The issuer will likely guide you through their specific dispute process, which may involve filling out a form or providing a written statement.
• What “good” looks like: You understand and are complying with the issuer’s requested steps.
• Common mistake and how to avoid it: Failing to complete all required paperwork or provide information promptly. This can delay or even invalidate your dispute.

6. Request a new credit card number.

• What to do: For security reasons, ask your issuer to cancel your current card and issue a new one with a different number.
• What “good” looks like: Your old card is deactivated, and a new one is on its way.
• Common mistake and how to avoid it: Not requesting a new card number, leaving your account vulnerable to further fraudulent activity.

7. Keep a record of all communications.

• What to do: Note the date and time of your calls, the name of the representative you spoke with, and any reference or case numbers provided. Save any emails or letters exchanged.
• What “good” looks like: You have a detailed log of all interactions related to the dispute.
• Common mistake and how to avoid it: Not keeping records. This documentation is vital if the dispute becomes complex or requires escalation.

8. Monitor your account and credit reports.

• What to do: Continue to check your credit card statements and your credit reports regularly to ensure no new unauthorized activity appears and that the dispute is progressing.
• What “good” looks like: Your account shows the disputed charges as pending or provisionally credited, and your credit reports remain clear of new fraudulent activity.
• Common mistake and how to avoid it: Becoming complacent after reporting. Ongoing vigilance is key to preventing further issues.

9. Follow up on the dispute.

• What to do: If you don’t hear back within the timeframe provided by the issuer, follow up to check the status of your dispute.
• What “good” looks like: You receive a resolution, and the unauthorized charges are removed from your account.
• Common mistake and how to avoid it: Assuming the dispute is resolved without confirmation. Proactive follow-up ensures closure.

10. Understand your liability.

• What to do: Familiarize yourself with federal laws like the Fair Credit Billing Act (FCBA), which limits your liability for unauthorized credit card charges.
• What “good” looks like: You know that under the FCBA, your liability for unauthorized charges on a credit card is generally limited to $50, and often $0 if reported promptly.
• Common mistake and how to avoid it: Believing you are responsible for the full amount of fraudulent charges. Understanding your rights protects you financially.

What affects your score (plain language)

• Payment History: Paying your bills on time is the biggest factor. Late payments can significantly lower your score.
• Amounts Owed (Credit Utilization): How much credit you’re using compared to your total available credit. Keeping this low is better.
• Length of Credit History: The longer you’ve had credit accounts open and in good standing, the more positive it looks.
• Credit Mix: Having a variety of credit types (like credit cards and installment loans) can be beneficial, but it’s less important than other factors.
• New Credit: Opening many new accounts in a short period can signal higher risk and temporarily lower your score.
• Public Records: Bankruptcies or tax liens can severely damage your score.
• Inquiries: When you apply for new credit, it often results in a hard inquiry, which can slightly lower your score.

What NOT to do while improving credit: Avoid closing old, unused credit accounts, as this can reduce your average account age and increase your credit utilization ratio. Also, never share your credit card information or Social Security number with anyone you don’t trust.

Common mistakes (and what happens if you ignore them)

Mistake	What it causes	Fix
Waiting too long to report unauthorized charges	Increased liability (though usually capped), potential for more fraud.	Report immediately upon discovery.
Contacting the merchant instead of the issuer	Delayed resolution, potential for issuer to deny dispute if merchant is uncooperative.	Always call the credit card issuer directly using the number on the back of your card.
Not canceling the compromised credit card	Continued risk of further fraudulent transactions on the same account.	Always request a new card with a new number when reporting fraud.
Failing to keep records of communication	Difficulty in tracking dispute progress or escalating if necessary.	Document all calls, emails, and correspondence, including dates, names, and reference numbers.
Not reviewing statements thoroughly	Missing fraudulent charges, leading to delayed reporting and potential issues.	Make it a habit to review every statement and online transaction history carefully each month.
Assuming a provisional credit means the dispute is over	The issuer might reverse the credit if the investigation finds the charge valid.	Wait for official confirmation from the issuer that the dispute has been fully resolved in your favor.
Not monitoring credit reports after reporting	Potentially missing other fraudulent activity or identity theft.	Regularly check your credit reports from all three bureaus after reporting fraud to ensure no other unauthorized accounts or activity appear.
Providing incorrect or incomplete information	Delays in the dispute process, or the dispute may be denied.	Be precise with dates, amounts, and merchant names when reporting charges.
Ignoring communications from the issuer	The dispute may be closed without resolution, or you might miss important updates.	Respond promptly to any requests for information from your credit card issuer regarding your dispute.

Decision rules (simple if/then)

• If you see a charge you don’t recognize on your statement, then review your recent transactions carefully because it could be an unauthorized charge.
• If you confirm a charge is unauthorized, then call your credit card issuer immediately because prompt reporting is key to limiting your liability.
• If you speak to a customer service representative, then clearly state that you are reporting fraudulent charges because this initiates the dispute process.
• If the issuer asks for documentation, then provide it promptly because delays can hinder your dispute.
• If your card number was compromised, then request a new card number because this prevents further fraudulent use of the old account.
• If you are disputing a charge, then keep detailed records of all communications because this serves as proof of your actions.
• If the issuer offers provisional credit, then understand it’s not a final resolution because the dispute is still under investigation.
• If you receive a resolution from the issuer, then review it to ensure the unauthorized charges have been removed because you need confirmation.
• If you suspect broader identity theft, then consider placing a fraud alert or credit freeze on your credit reports because this protects you from further misuse of your information.
• If you are unsure about your rights, then review the Fair Credit Billing Act (FCBA) because it outlines consumer protections for credit card billing errors and unauthorized charges.
• If the dispute is denied and you believe it’s unfair, then ask the issuer for the specific reasons and consider escalating the issue because you have rights.
• If you are a victim of identity theft, then file a report with the Federal Trade Commission (FTC) because this creates an official record that can help with disputes.

FAQ

Q: How quickly do I need to report an unauthorized charge?

A: Report it as soon as you discover it. Federal law limits your liability to $50 if you report within 60 days of the statement date, and many issuers offer $0 liability if reported promptly.

Q: What if the unauthorized charge is small?

A: Report it regardless of the amount. Small charges can be a sign of more significant fraud or identity theft.

Q: Can I dispute a charge if I already paid my bill?

A: Yes, you can still dispute a charge even if you’ve paid the bill. However, it’s best to dispute it before payment to avoid paying for something you didn’t authorize.

Q: What happens to my credit score if I have unauthorized charges?

A: If handled correctly, unauthorized charges themselves usually don’t directly impact your score. However, if they lead to missed payments or increased debt that you don’t address, your score could suffer.

Q: How long does a dispute typically take?

A: The process can vary. Issuers usually have up to 60 days to investigate, but often resolve disputes much faster.

Q: What if my debit card was used fraudulently?

A: Report unauthorized debit card transactions immediately to your bank. Federal law offers protections, but reporting within two business days is crucial to limit your liability to $50.

Q: Do I need to file a police report?

A: It’s often not required by card issuers but can be helpful if you suspect widespread identity theft or if the issuer requests it.

Q: Can my credit card company refuse to refund the charge?

A: While they investigate, they may not immediately refund. However, if the charge is proven to be unauthorized, they are legally obligated to remove it.

What this page does NOT cover (and where to go next)

• Detailed legal advice on consumer protection laws. Consult with a legal professional or consumer advocacy group for specific legal guidance.
• Specific timelines or procedures for every single credit card issuer. Refer to your cardholder agreement or contact your issuer directly for their exact policies.
• How to dispute charges on prepaid cards or other non-credit payment methods. Research the specific terms and conditions for those payment types.
• Strategies for recovering from extensive identity theft. For comprehensive identity theft recovery, consult resources like the Federal Trade Commission (FTC).
• How to negotiate with merchants directly for refunds on legitimate but unsatisfactory purchases. This article focuses on unauthorized transactions.