Among various payment systems, credit card payments accounted for the most reports of fraud (389,737) in 2021, according to a report by the Federal Trade Commission. Credit card holders need to be very watchful if they’re going to avoid credit card fraud.
So, if you have been impacted by credit card fraud and reported the matter to your card issuer, having the bank refuse to entertain your fraud claim is adding insult to injury. Reader Sara writes that this is exactly what happened to her.
“My mother was in rehabilitation in August 2021, when someone apparently stole or cloned her card and used the card for approximately $500 in purchases,” Sara writes. Regions Bank Visa Credit Card refuses to acknowledge that a bedridden woman did not drive to Walmart, Shell and CVS to spend $500 over a three-day period.
“They will not provide copies of the receipts either,” Sara writes. “My mother didn’t leave rehab at any time. She doesn’t drive. She had the card in her possession when I checked her out of rehab. What is my recourse? My mother is on a limited income. I suspect her card was cloned while she was in rehab.”
Reasonable dispute investigation
If you suspect you are the victim of credit card fraud, you have protections under the Fair Credit Billing Act. To access those protections, you should immediately contact your credit card issuer and dispute the transaction.
The law places certain responsibilities on the lender in investigating your claim of a fraudulent transaction, and it can’t just getc away with a cursory review. For instance, a reasonable investigation into this sort of dispute could involve the following:
- Comparing the purchasing pattern for the claim, such as types and amounts of purchases, with the consumer’s previous purchases
- Reviewing the place of delivery relative to the consumer’s home or business address
- Considering where the purchases were made relative to the consumer’s address and typical shopping venues
- Comparing the signature on any purchase receipts with the consumer’s signature
- Asking for documentation to help verify the claim
- Asking for a written, signed statement about the fraudulent transaction
- Asking for a copy of any police report about the unauthorized transaction you may have filed
- Requesting input on the person who allegedly committed the fraud or their authority to make use of your card
The issuer has a reasonable right to expect your cooperation in gathering this sort of input. But it cannot automatically deny your claim because you did not provide some particular piece.
However, if the issuer doesn’t have enough information confirming the fraudulent transaction and you haven’t provided relevant information that would help build the case, the issuer could close the case due to lack of information.
Responding to a query for comment on Sara’s mother’s case, a spokesperson for Regions Bank noted: “Regions Bank is committed to helping protect customers from any attempts at fraud against their accounts. Our investigations are detailed and thorough as we work to get to the bottom of whatever may have transpired in any instance reported to us.”
Other recourse
If your fraudulent transaction claim is denied by a bank, you should first find out why the claim was denied. Loan Lawyers law firm advises that the bank may hold you responsible in case you “failed to take reasonable care to protect your identity and your account.”
The bank could also view you as culpable if you’re believed to be “part of the scheme and simply want to make purchases and not be held liable for them.” For one, if your information was obtained from your computer, the bank might believe you were complicit in the scheme.
The silver lining is that you don’t have to prove your innocence. And in order to hold you liable for a fraudulent charge, the onus is on the issuer to prove its case.
What you can do: File a police report about the fraudulent transaction. You could even file a case with the Federal Bureau of Investigation if the amount involved is large enough. A good way to get a bank’s attention is to file a complaint with its regulator.
You could also file a complaint with the Federal Trade Commission or the Consumer Financial Protection Bureau. You could even talk to an attorney to get specific input about your case.
The bottom line
Sara, there are specific rules a bank must follow in looking into a claim of credit card fraud to ensure a reasonable investigation. You should follow up with theRegions Bank dispute process to ask why your mother’s claim was denied.
If you are not satisfied with the bank’s response, you could file a complaint with the CFPB or the Federal Reserve Board, which regulates Regions Bank . Another recourse is to go to the Alabama State Banking Department with your complaint, since the bank is based in that state. You could also file a police report about your case or hire an attorney to give you specific advice. If you suspect your mother’s card has been compromised, you should ask the bank to cancel it and issue a replacement card. Hope your mother’s fraud investigation is settled to your satisfaction!
Contact me at[email protected]with your credit card-related questions.
FAQs
Send them a letter stating that you're appealing the bank's decision and follow any other instructions the bank provides regarding appeals. File a police report about the fraudulent transaction. You could even file a case with the Federal Bureau of Investigation if the amount involved is large enough.
What do I do if my bank won't refund fraudulent charges? ›
If the Consumer Financial Protection Bureau (CFPB) finds that your bank did not follow proper procedures or violated any laws, the bureau may take legal action. You can submit a complaint by: Completing the online form. Calling 855-411-CFPB (2372).
What do I do if I was scammed and my bank wont refund me? ›
Explain what's happened and ask if you can get a refund. If you're not happy with how the bank deals with your claim, you can complain to them. Find out how to do this by checking their website. If it's been 8 weeks since you complained, and you haven't got your money back, contact the Financial Ombudsman.
Can you sue a bank for not refunding your money? ›
If the bank fails to conduct a reasonable investigation or comes to a completely unreasonable conclusion with the evidence they have, you may have a claim against the bank for violations of the Electronic Funds Transfers Act (EFTA).
What to do if a bank refuses to give you your money? ›
Be sure to speak with the bank's branch manager and their fraud department to gather as much evidence from the bank as to why they have a hold on your account. If the legal department does not respond, you can sue the bank in court (in the county where your bank branch is located).
Can you force a refund through the bank? ›
The chargeback process lets you ask your bank to refund a payment on your debit card when a purchase has gone wrong. You should contact the seller first, as you cannot start a chargeback claim unless you have done this.
What to do if the bank is not refunding money? ›
You should contact your bank and raise a dispute as this is an option for all the consumers. This dispute can be raised by visiting the bank personally, via telephonic conversation or in writing an email to bank support.
What to do if someone refuses to refund money? ›
Get Outside Help
- Contact your state attorney general or state consumer protection office. ...
- Contact a national consumer organization. ...
- Contact your local Better Business Bureau The Better Business Bureau is made up of organizations supported by local businesses. ...
- File a report with the FTC.
If the merchant won't give them a refund, they can simply ask the bank to get them their money back instead. From a merchant's perspective, however, chargebacks and refunds are two very different things.
Can a bank reject a refund? ›
If funds aren't available or the bank refuses to return the funds, the IRS cannot compel the bank to do so. The case may then become a civil matter between you and the financial institution and/or the owner of the account into which the funds were deposited.
Your bank can only refuse to refund an unauthorised payment if: it can prove you authorised the payment. it can prove you acted fraudulently.
Who holds banks accountable? ›
The regulatory agencies primarily responsible for supervising the internal operations of commercial banks and administering the state and federal banking laws applicable to commercial banks in the United States include the Federal Reserve System, the Office of the Comptroller of the Currency (OCC), the FDIC and the ...
Does filing a complaint with CFPB do anything? ›
We'll share your complaint with the company so it can review and respond to the issues you've described. If we can't send your complaint to the company for response, we'll send it to another federal agency and let you know. The CFPB takes a privacy-first approach when it comes to your personal information.
What if I got scammed and my bank won't refund me? ›
Some situations are successfully resolved over time, but many consumers are not as fortunate. If you have notified your financial institution about unauthorized transactions, but your bank won't refund stolen money, you may need a consumer fraud lawyer to protect your rights.
How do I get my money back from an unauthorized transaction? ›
Once you see an unauthorized transaction on your account and notify your financial institution, your bank or credit union has 10 days to investigate the claim. If the bank finds the error, they have one day to issue you a refund and then three more days to report their findings to you in writing.
Is it legal for a bank to hold your money from you? ›
Yes. Your bank may hold the funds according to its funds availability policy. Or it may have placed an exception hold on the deposit. If the bank has placed a hold on the deposit, the bank generally should provide you with written notice of the hold.
Will my bank reverse fraudulent charges? ›
Did a scammer make an unauthorized transfer from your bank account? Contact your bank and tell them it was an unauthorized debit or withdrawal. Ask them to reverse the transaction and give you your money back.
Can banks cancel fraudulent transactions? ›
If you find something wrong, contact your bank as soon as possible. The sooner you contact your bank, the more likely you are to get your money back — and if the transaction is unauthorised, the sooner the bank can stop any further transactions.
What are the refund rules for fraudulent transactions? ›
Within 4-7 days: If you register your complaint after 3 days and between 7 days of the fraudulent transaction, then you will have to bear the limited liability of INR 5,000 to INR 25,000, whichever is lower. After deducting the lowest amount, the rest of it will be returned to you.
Can a bank refuse to do a chargeback? ›
If your Chargeback request is rejected, you've got a right to know why. If you think their decision is unfair you can complain to the bank. If they still refuse your claim, you've got six months to take your case to the Financial Ombudsman. The bank's decision might then be overturned.
