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Debit Card Disputes & Fraud Claims

When charges and purchases appear on your statement that you do not recognize, they may be fraudulent, or they may not be. We’re here to guide you on whether to file a dispute or a fraudulent claim. Neighborhood Credit Union’s policies and procedures for processing fraudulent and disputed transactions are governed by the Electronic Funds Transfer Act, or Federal Regulation E, and they are outlined in our Electronic Services Agreement and Disclosure.
 

The primary difference between a fraudulent transaction and a disputable transaction lies in whether or not the cardholder or an authorized user knowingly and willingly initiated the transaction with the merchant in the first place.

 

Disputes can arise between a merchant and a cardholder for a variety of reasons, including but not limited to overcharging the cardholder, charging the cardholder for merchandise that wasn’t received, or charging the cardholder for a monthly subscription that was previously cancelled. 

If the transaction was never authorized or initiated by the cardholder, a fraud claim may be filed.

Answering the following questions will help you to determine whether your claim is a dispute or fraud.

  1. Do you personally know who made the transaction on your debit card? 
  1. Is the transaction a result of signing up online for a “free trial”, however you used your debit card to pay for shipping or a similar charge? 
  1. Did you give or loan your debit card to anyone? (You cannot make a claim of any kind if you voluntarily gave your card or device with saved card information to another person.)

 

If you answered “Yes” to Questions 1 or 2, this would be a Dispute Claim.
If you answered “No” to all three questions, this would be considered a Fraud Claim.


If you answered “yes” to question 3, you do not have a valid claim. No claims can be made if you gave your card to someone voluntarily.

What is a cardholder dispute (also known as a merchant dispute)?

When you have a disagreement with a merchant about a charge they made to your debit card, this is considered a cardholder dispute. For example:

  • You cancelled a transaction, but the merchant still charged you. For instance: You used your credit card to reserve a hotel room, and cancelled with the hotel in accordance with their cancellation guidelines, and you were still charged for the room.
  • You purchased an item using your debit card, and later returned the item to the merchant, but your card was never credited for the return.
  • You were charged the incorrect amount for a transaction, for example $400 rather than $40.
  • You have an issue with the quality of goods or services provided.
  • The items purchased were never received.

 

Notifying Us of Your Dispute

It is critical that you notify us within two (2) business days of the date you first became aware of the transaction you want to dispute. Failure to notify us within two (2) business days increases your liability from $50 to $500. Failure to notify us within 60 days of when the disputed transaction appears on your statement means you are liable for the entire amount of the disputed transaction. Please notify us of any disputes by calling 214-748-9393.

 

How Your Dispute is Processed

  • Merchant disputes under $25 will need to be settled directly with the merchant.  This is due to a minimum threshold amount of $25 enforced by Visa.
  • If the amount of the merchant dispute is more than $25, can begin the processing upon receipt of the completed form and any supporting documentation required.
  • Once the investigation is complete, you will be notified in writing.

What is debit card fraud?

A transaction is considered fraudulent only when you have no knowledge of who used your card and you can state with certainty that you were not aware of the transaction. You will be required to sign an affidavit stating that you have no knowledge of who completed the transaction(s) in question. If you intentionally file a false or unsubstantiated fraud claim, you may be charged a fee.

 

Notifying Us of Fraud

It’s critical that you notify us within two (2) business days of the date you first became aware of the fraudulent activity. Failure to notify us within two (2) business days increases your liability from $50 to $500. Failure to notify us within 60 days of when the fraudulent transaction appears on your statement means you are liable for the entire amount of the fraudulent transaction. Please notify us of any disputes by calling 214.748.9393.

 

How Your Fraud Claim is Processed

We begin processing your claim as soon as you notify us. You may notify us in writing or by phone. Neighborhood CU has ten (10) days to investigate your claim. If we cannot finish our investigation within ten (10) business days we must provisionally credit your account for the amount of the claim. If your claim is determined to be invalid, you must return the provisional credit, and we will debit your account for the entire amount of the provisional credit within three (3) days of completing our investigation.  The entire process could take up to 90 calendar days between Neighborhood Credit Union, Visa and the merchant where the fraudulent transactions occurred.  Once the investigation is complete, you will be notified in writing.

Identity theft occurs when someone uses a person’s identity or personal information—such as their name, driver's license, or Social Security number—without permission to commit a crime or fraud. 

Being a victim of identity theft can affect people in a variety of ways including damage to their credit, emotional distress, plus time and energy to resolve the issues. Identity theft puts our member’s personal information at risk to individuals and organized crime all while going unnoticed.

For additional information or to report being a victim of identity theft, please visit identitytheft.gov.

Traditionally scams are defined as a fraudulent scheme performed by a dishonest individual, group, or company in an attempt to obtain money or something else of value. While there are more traditional scams such as impersonation, our use of connected technology has provided for new scams to emerge. They can be lottery scams, scam baiting, email spoofing, phishing, or request for helps. These are considered to be email fraud. 

For additional information or to report being a victim of a scam, please refer to the weblinks below:

Scams (rip-offs and imposters, unwanted telemarketing, text, or SPAM, etc): www.ftccomplaintassistant.gov

International Scams: www.econsumer.gov

  • Never give out your online banking credentials to anyone for any reason.
  • Keep your Debit or Credit Card Pin separate from your card and do not share it with anyone.
  • Never give your debit or credit card information over the phone to someone who calls stating you owe money. Scammers will use this tactic to scare people into giving their card details over the phone for them to make fraudulent purchases.  If you have any doubt to the legitimacy of the call, hang up and call the company directly on a main phone number.   If the call is not legit, notify local non-emergency police.
  • Periodically review your credit report for new credit lines or accounts not opened by you.