Kevin L. Hernandez, Esq.
Attorney at Law
The Fair Credit Billing Act (FCBA)
Protecting Consumers Against Credit Card Billing Errors
The FCBA is a federal law enacted to protect consumers from inaccurate or unfair credit card billing practices. It applies to credit card accounts and certain other open-ended credit accounts. Whether you’ve been charged for a purchase you didn’t make or were billed incorrectly, the FCBA gives you powerful tools to resolve disputes and maintain your financial well-being.
What Does the FCBA Cover?
The FCBA applies to credit cards and revolving charge accounts, addressing a variety of billing issues, including (among others):
- Unauthorized charges or fraudulent transactions
- Charges for goods or services not delivered or not accepted
- Incorrect amounts charged or duplicate charges
- Failure to post payments or other credits (like returns or refunds)
- Mathematical errors on a billing statement
How to Dispute Billing Errors Under the FCBA
To dispute a credit card billing error, follow these steps:
- Act Quickly. You must notify your creditor within 60 days of the statement date containing the error.
- Submit a Written Notice. Write to the “billing inquiries” address provided on your statement (not the payment address). Your letter should include:
– Your name and account number.
– A clear description of the error.
– The dollar amount in question.
– Any supporting documentation, such as receipts or confirmation emails. - Await the Creditor’s Response. The creditor must acknowledge your dispute in writing within 30 days of receiving your notice.
- Investigation and Resolution. The creditor has 90 days to investigate and resolve the dispute. During this time, they cannot collect the disputed amount or report it as delinquent.
Other Dispute Tips:
- Keep a copy of the letter for your records.
- Send the letter by certified mail, so you have proof that the credit card issuer received your dispute.
- Continue to make payments on the rest of your balance, but do not include the disputed amount. The issuer is required to investigate the dispute and will not charge you interest on the disputed amount during the investigation period.
- The credit card issuer must acknowledge the dispute within 30 days and resolve it within 2 billing cycles (but not more than 90 days).
Legal Protections and Rights Under the FCBA
- Limited Liability for Unauthorized Charges. You are only responsible for up to $50 of unauthorized charges, and many card issuers waive this entirely.
- Right to Withhold Payment. You may withhold payment on the disputed amount during the investigation period.
- Protection Against Retaliation. Creditors cannot close your account or penalize you for exercising your FCBA rights.
What Happens If the Creditor Fails to Comply?
If the creditor violates the FCBA, you may have a legal claim. Common FCBA violations include failing to investigate disputes or trying to collect disputed amounts without resolution.
How FCBA Legal Claims Work
Under the FCBA, you may be entitled to:
- Actual damages caused by the creditor’s non-compliance
- Statutory damages equal to twice the amount of any finance charge connected to the disputed transaction with a minimum of $500 and a maximum of $5,000
- Reimbursement of reasonable attorney’s fees and court costs if you prevail
We are dedicated to protecting consumers like you under the FCBA. If you’re facing unresolved billing errors, unauthorized charges, or creditor misconduct, contact us for a free consultation today.
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