Under the Fair Credit Billing Act (FCBA), U.S. consumers have the legal right to dispute unauthorized charges on their credit card accounts. An unauthorized charge is generally defined as a transaction made by someone who did not have the cardholder's permission to use the card. To fully protect these legal rights, a consumer must send a written dispute notice to the creditor’s designated "billing inquiries" address so that it reaches them within 60 days of the date the first statement containing the error was mailed. While many banks allow disputes via phone or mobile app, federal law specifically requires written notice to trigger the full protections of the FCBA. Under Regulation Z, a consumer's maximum liability for unauthorized use of a credit card is capped at $50.
What Controls the Issue
The primary framework governing credit card disputes in the United States is the Fair Credit Billing Act (FCBA), implemented through Regulation Z. This federal law establishes the procedures for correcting billing errors, which include unauthorized charges, mathematical errors, and charges for goods or services not delivered as agreed.
It is important to distinguish these protections from the Electronic Fund Transfer Act (EFTA), which governs debit cards and ACH transfers. Credit cards offer a statutory $50 liability limit for unauthorized use, whereas debit card liability can increase significantly depending on how quickly the loss or theft is reported. For more information on these rules, you can review the official guidance from the FTC.
Confirmed Legal Rights and Deadlines
Official guidance from the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB) confirms several key protections for credit cardholders as of 2026:
- Written Notice Requirement: To preserve legal rights under the FCBA, the dispute must be submitted in writing.
- 60-Day Window: The written notice must reach the creditor within 60 days of the date the statement containing the error was mailed.
- Liability Cap: Federal law limits your liability for unauthorized charges to $50. If your card number was stolen but the physical card was not, you generally have $0 liability under federal law for subsequent unauthorized use.
- Acknowledgment: Creditors are required to acknowledge a billing error dispute in writing.
While major card networks like Visa and Mastercard often promote "Zero Liability" policies, these are private brand policies rather than federal law. These policies may waive the $50 statutory liability, but they are subject to the bank's implementation and the consumer's "reasonable care" in protecting the account.
Action Checklist for Disputing a Charge
To effectively dispute an unauthorized charge and maintain your legal protections, follow these steps:
- Immediate Notification: Call the card issuer or use their mobile app to freeze the card. This prevents further fraudulent charges while you prepare your formal dispute.
- Identify the Correct Address: Look on the back of your credit card statement for the specific address listed for "billing inquiries." This is often different from the address where you send monthly payments.
- Draft a Dispute Letter: Include your name, account number, the dollar amount of the unauthorized charge, and a clear statement that the charge was not authorized.
- Send via Certified Mail: Mail the letter using certified mail with a return receipt requested. This provides evidence that the creditor received your notice within the 60-day legal window.
- Gather Documentation: Keep copies of your statement, the dispute letter, and the mailing receipt. If the physical card was stolen, a police report can serve as additional evidence.
FCBA Dispute Requirements
The following table outlines the statutory requirements for a formal billing dispute under Regulation Z (§ 1026.12).
| Requirement | Detail under the FCBA |
|---|---|
| Notice Format | Written letter required to trigger legal rights |
| Deadline | 60 days from the statement mailing date |
| Maximum Liability | $50 for unauthorized use |
| Creditor Duty | Must acknowledge the dispute in writing |
Escalation Paths
If a card issuer fails to follow the statutory requirements of the FCBA or does not conduct a proper investigation, consumers have several escalation routes. You can file an official complaint with the Consumer Financial Protection Bureau (CFPB) or the Federal Trade Commission (FTC). These agencies oversee creditor compliance with federal consumer protection laws.
FAQ
What if I already paid the bill containing the unauthorized charge? You still have the right to dispute an unauthorized charge even if you have already paid the statement. The 60-day window from the statement date remains the critical deadline for your written notice.
Do I have to pay the disputed amount during the investigation? Under the FCBA, you may withhold payment for the disputed amount and any related finance charges while the investigation is pending. However, you are still required to pay any portion of the bill that is not in dispute.
What is the difference between a merchant refund and a billing dispute? A merchant refund is a voluntary transaction governed by the store's return policy. A billing dispute is a legal process used when a charge is unauthorized, or the merchant fails to deliver goods or services as promised. If a merchant refuses a valid refund for an unauthorized charge, the FCBA dispute process is the appropriate legal recourse.