Can I cancel a credit card transaction if I was defrauded?

What the Law Says

The right to cancel or dispute a fraudulent credit card transaction comes from the Fair Credit Billing Act (FCBA), which is Title III of the Truth in Lending Act (TILA). While 15 U.S.C. § 1601 states Congress’s broad purpose for TILA, the specific protections for billing errors—including unauthorized charges—are found in 15 U.S.C. § 1666 (not provided here but legally operative). The FCBA limits your liability and sets clear procedures for disputing fraud.

Under federal law, if someone uses your credit card without permission, your liability is capped at $50 — and many issuers waive even that amount.

You must report the fraud promptly: written notice to your card issuer within 60 days after the statement showing the unauthorized charge is mailed to you.

Once you dispute the charge in writing, the issuer must acknowledge your notice within 30 days and complete its investigation within two complete billing cycles (but no longer than 90 days).

During the investigation, you don’t have to pay the disputed amount or related finance charges — and it cannot be reported as delinquent.

Statutory Text

The Congress finds that economic stabilization would be enhanced and the competition among the various financial institutions and other firms engaged in the extension of consumer credit would be strengthened by the informed use of credit on the part of consumers of goods and services.

— 15 U.S.C. § 1601 — Congressional findings and declaration of purpose

What to Do

Sources