Consumer Protection Law

Protecting Your Personal Accounts From Unauthorized Charges

Life is busy and going through the mail takes time. However, when the mail includes your monthly bank or credit card statement then your time is well spent to review the statement carefully. Both your monthly checking account statement and your credit card statements will include automatic debits or automatic charges to your account. For one or more reasons, your account may include unauthorized automatic debits or charges and if you do not catch them and properly dispute them then you will pay the financial cost.
Why Unauthorized Debits or Charges Occur
There are several reasons why you may be a victim of unauthorized debits to your checking account or charges to your credit card. Those reasons include:
  • You have recurring payments set up and something goes wrong: Many people make arrangements to pay their regularly recurring bills through an automatic payment. For example, people may have their monthly mortgage, insurance payments, telephone or television payments automatically deducted from their checking accounts or billed to a credit card. These payments are valid and intended to make bill paying easier since they eliminate the need for writing checks and addressing envelopes. However, sometimes mistakes happen and the creditor or business billing your account makes a mistake by charging you the wrong amount, by billing you more than once or by billing you for services which you did not authorize.
  • Telemarketing scams: many people may be lured into providing their checking account information to telemarketers who promise to provide them with a “free gift.” A telemarketer may claim that he needs a checking account number or credit card to verify gift and then use that information to charge a fee for the so called “free gift”.
  • Fraud: Unauthorized debits or credit charges can occur if your account information is stolen. The information may be used to set up automatic withdrawals from your checking account since the person making the purchases would not have to show identification or even present a physical check.
Also, remember the free trial of that magazine or satellite radio station that you signed up for? Many different companies offer free trial periods. However, if you do not cancel within the required time then the company may continue to take automatic payments from you. While their actions are not technically unauthorized, they may come as a surprise to you. So, be sure to check the fine print to find out when and how to cancel so that you do not keep paying month after month for the free trial.
What to Do if Your Account Has an Unauthorized Charge
It is important to review your monthly statements each month to determine if there has been any unauthorized use. If you find that there has been unauthorized use then you should immediately follow the instructions on the bill for filing a dispute. By filing a complaint immediately, your financial liability may be limited by law and you may stand the best chance of stopping the charges from recurring. You should also file a complaint with the Federal Trade Commission (FTC). While the FTC may not be able to recover your money, it can keep track of patterns of unauthorized charges being made by particular companies and prevent the company from taking advantage of other consumers.