What To Do When a Bank Won’t Refund Stolen Money

It’s an unfortunate but familiar problem: somebody stole your credit or debit card information and spent your money. If you don’t report those fraudulent charges right away, it’s possible your bank won’t refund stolen money and you’ll be on the hook for unauthorized transactions.

The best bet for getting your money back is to notify your bank of fraudulent charges as soon as possible. But if it’s too late and your bank won’t refund an unauthorized transaction, you can submit a complaint to government agencies.

Do banks reimburse stolen money?

Banks often reimburse stolen money, but there are some exceptions. Transactions not made by you or anyone authorized to use your account are fraudulent, and federal law protects your money. Banks must refund you in certain circumstances, but the longer you wait to notify them, the more likely your bank won’t refund stolen money.

If your debit card is lost or stolen, you should notify your bank within two business days of any unauthorized charges. If you do, the most you can be liable for is $50. If you notify the bank within 60 days, you can be liable for a maximum of $500. After 60 days, it’s possible you’ll be responsible for all the scammed money. If you experience debit card fraud without losing your card or having it stolen, you’re not liable for any fraud if you report it within 60 days.

The rules for credit cards are a bit different. At most, you’ll be liable for $50, and you aren’t required to notify the bank within a specific timeframe.

You aren’t responsible for additional unauthorized charges once you report debit or credit card fraud. It’s a good idea to pause or cancel your card as soon as you realize you don’t have it, but notifying your bank that the card’s gone should help protect you from further losses.

Sometimes credit card providers will catch the fraud with tools designed to find suspicious transactions. Sometimes banks will refund the total amount of fraudulent charges even if they’re not legally required. But, if enough time elapses between the charge and the fraud report, a bank might refuse to reimburse some of your money.

How to dispute fraudulent charges

Regardless of which bank or credit card issuer you use, there are some standard steps you can take to recover money lost to fraudulent charges.

1. Monitor statements for fraudulent charges. Sometimes fraud goes under the radar, so be proactive and regularly check your debit or credit statements to see if there were any unusual purchases.
2. Lock access to your card. As soon as you notice you’ve lost your card or have had it stolen, pause transactions or cancel the card so nobody can use it. You can always order a replacement, sometimes for free.
3. Contact your bank as soon as possible. The longer you wait to report unauthorized purchases, the more liable you are for the costs. You limit your liability if you contact the bank within two business days.
4. Follow up with a written letter. If you think you’re entitled to a reimbursement, you should write a letter to your financial institution. Include detailed information about your account, the unauthorized charges and when you originally reported the fraud.
5. Submit a complaint to the CFPB, if necessary. If you’ve sent a letter and still haven’t recovered your money, you can contact the Consumer Financial Protection Bureau (CFPB) to submit a complaint about financial products or services.

If someone uses your debit or credit card information, you should report it as quickly as possible through customer service. Once you’ve done that, you can follow up with a written letter — be sure to keep a physical copy for your records if you eventually submit a complaint. The CFPB can help you recover money lost to fraud. But, you’re ultimately liable for some of those losses if you don’t report them on time.

How to prevent debit or credit card fraud

Nobody wants to deal with debit or credit card fraud. Even if you’re reimbursed, the process of restoring access to your account and getting your money back is annoying. It’s tough to guarantee that your card information won’t ever be stolen, but taking some precautions can help.

Only use ATMs you trust — preferably at your bank or credit union — as non-bank ATMs and even card scanners at gas stations can sometimes have skimmers, which are little devices that steal your card information. Keep your Personal Identification Number (PIN) secure and change it as necessary.

Also be aware that phishing scams sometimes ask for personal information over the phone, email or social media. Don’t respond to those messages, and contact your bank instead.