What to Do When Your Bank Doesn’t Refund a Fraudulent Charge

Discovering fraudulent charges on your credit card is the worst, especially if your bank denies your dispute. If this happens, act quickly, be persistent and thorough.

Here’s steps to take to increase your odds of remedying the situation.

Gather Evidence and Re-Contact the Bank

Gather all documentation related to the fraudulent transaction. This can include:
Notifications from your bank about the charge.

Communication logs (dates, times, and summaries of conversations with bank representatives).
Any information from the merchant where the fraudulent transaction took place (e.g., details or proof that you didn’t authorize the transaction).

Tip: Politely but firmly request that your case be escalated to a higher authority within the fraud department. Explain that you have collected evidence and would like a thorough review of the case.

Check for Phone Number Spoofing

If your bank claims the fraudulent card activation occurred using your phone number, ask for a detailed explanation. Scammers often spoof phone numbers, making it appear as though calls are coming from your number when they’re not.

Action Step: Review your phone records for the date and time the activation supposedly occurred. If there’s no call to your bank’s activation line, this is evidence in your favor.

File a Police Report

Head to your local police station and file a report detailing the fraud. While police may not actively investigate, having an official report is essential for escalating your case with the bank.

Why It’s Important: Financial institutions often require a police report to take fraud claims seriously. The report shows that you’re committed to proving your innocence, serious about getting the problem fixed and not attempting “friendly fraud” (disputing a charge you actually made).

Contact the Merchant

If possible, reach out to the merchant where the fraudulent charge occurred. In the case of a big retailer, speak with their Asset Protection team and request any available information or security footage related to the transaction. This may provide additional evidence for your case.

Example: If the fraudulent purchase was made using a gift card, the merchant may have policies requiring identification for large gift card transactions.

File a Complaint with a Regulatory Agency

If your bank still refuses to refund the charge, file a complaint with one of the following agencies:

Consumer Financial Protection Bureau (CFPB): The CFPB handles consumer complaints and can pressure the bank to reconsider your case. Visit consumerfinance.gov to file a complaint.

Office of the Comptroller of the Currency (OCC): If your bank is federally regulated, the OCC may also be able to assist. Their website, HelpWithMyBank.gov, provides information on how to proceed.

Freeze Your Credit and Monitor for Further Fraud

Fraudulent activity often signals broader identity theft issues. To protect yourself:

• Freeze your credit with all three major credit bureaus (Equifax, Experian, and TransUnion).
• Consider signing up for identity theft protection services.
• Stay vigilant for suspicious calls, texts, or emails, which may be related to the fraud.

Consider Taking Legal Action

If all else fails, consider filing a case in small claims court. This may sound daunting, but you don’t need to hire a lawyer. Present your evidence, and if you win, the court will order the bank to refund your money. Keep in mind that actually collecting the funds from the bank can be a separate challenge.

Note: Be sure to document the time and resources you’ve spent trying to resolve the fraud, as you may be able to include these expenses in your claim.

Stay Calm and Persistent

Navigating fraud disputes can be frustrating, but staying composed and determined can make a difference. Remain polite but assertive in all communications, and don’t be afraid to escalate your case as needed.

Finally, if your bank repeatedly fails to support you, consider moving your business to a more reliable financial institution. You want to work with a bank you can trust and one that trusts you. Many people find credit unions or smaller banks to offer better customer service and fraud protection compared to larger banks with a history of consumer issues. By following these steps, you’ll be in a stronger position to fight back and protect your finances from fraud. If you’re feeling overwhelmed, remember that consumer protection agencies are there to support you and help resolve disputes with financial institutions.