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Author: D1lettante Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308881  
Subject: Charge dispute blown off, now what? Date: 10/7/2004 2:32 PM
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I haven't posted much here - I don't even know if I posted my happy dance a couple of years ago - but now an old card has reared its ugly head and is stressing me out.

I have a BoA card. It was originally a balance-transfer card during debt pay-down, which worked well, but I didn't cancel it after I no longer needed it and after a few years, it recently sprouted a bogus charge - for some credit protection thing, I think it was.

I disputed the charge with BoA using the FTC's dispute letter template, certified mail return-receipt-requested, the works. This is the response I got:

"Thank you for your recent inquiry concerning the charge billed to your Bank of America credit card account in the amount of $9.95. Unfortunately, as we are unable to cancel memberships for cardholders, you must contact the merchant directly and request credit for charges already billed.

"After you contact the merchant, please forward a letter to us indicating the date on which you cancelled the membership and the merchant's response."

(Emphases mine)

Cancel the membership? What? I wrote regarding a fraudulent charge, not some inconvenient membership I was too lazy to cancel!

Is this in violation of the FCBA, or did I misunderstand the process? They never used the word "investigation" in their response, so I don't think they're claiming to have done one, which I thought they were required to do. I don't have contact information on this "merchant" beyond the 800 number printed on the bill. Needless to say I would prefer to contact them in writing if at all. Heaven knows what they'd claim I signed up for if I were to call the number.

Any advice would be appreciated. I never thought they could just reject a dispute letter like this.
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Author: zentec Two stars, 250 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 190849 of 308881
Subject: Re: Charge dispute blown off, now what? Date: 10/7/2004 2:57 PM
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Credit cards are have been tightening up the dispute process it seems. I don't know if they are trying to save money or are shovelling more of the chargeback risk onto the merchants. However, having been a merchant that accepted credit cards, I can tell you the following generally works when disputing charges.

1. Goods not as advertised. Submit supporting evidence or other documentation. Hearsay is not going to win this one, but the credit card companies are pretty liberal if you can clearly show the goods were not as advertised.

2. Not an authorized charge or unauthorized recuring billing. This generally is easy to fight once you contact the merchant and _ask_ for a copy of the contract or a credit card receipt with your signature. Most merchants can't find a pen in which to jot down your phone number, so you'll win if they can't find your contract. If it's a telephone order, then they won't have your signature on a contract nor a sales slip and telephone orders put 100% of the risk of a chargeback squarely on the merchant.

So what you need to do is first write another letter to the credit card company and explain that you're going to contact the merchant as requested. They should restart the dispute process.

Contact the merchant and ask for a refund. They'll probably refuse so you'll need to (nicely) ask for a copy of the contract or a credit card sales slip with your signature. If they can not find one, ask for them to fax, mail or email that fact to you. They probably won't do that, so be sure to get the phone number and name of the customer support representative that you speak with since that'll be about the only supporting information you'll have when you write letter number two to the credit card company. In that letter, you'll tell the credit card company that you asked for and have not been provided a copy of the contract/service agreement nor a credit card sales slip with your signature. The rules concerning telephone/online orders should then handle your dispute. Those rules are that the merchant is wrong until proven otherwise.



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Author: joelcorley Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 190852 of 308881
Subject: Re: Charge dispute blown off, now what? Date: 10/7/2004 4:14 PM
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D1lettante,

You wrote, Cancel the membership? What? I wrote regarding a fraudulent charge, not some inconvenient membership I was too lazy to cancel!

Is this in violation of the FCBA, or did I misunderstand the process? They never used the word "investigation" in their response, so I don't think they're claiming to have done one, which I thought they were required to do. I don't have contact information on this "merchant" beyond the 800 number printed on the bill. Needless to say I would prefer to contact them in writing if at all. Heaven knows what they'd claim I signed up for if I were to call the number.


Likely you've become a victim of some opt-out clause that was added to your credit card agreement. The problem with such clauses is that they purport to create a wholly new and separate contract with a third party without your explicit consent. I don't think such a contract is legally binding. What's more, I believe there are class-action lawsuits winding their way through the court system over this very issue.

Yes, BoA is almost certainly in violation of the FCBA, though honestly that might not do you all that much good unless and until they actually report you as in default to the CRAs. It's the FCRA and FDCPA that have real teeth, not the FCBA. Write them back with a copy of your original letter and their response. Tell them that you didn't subscribe to anything and that you specifically stated in your original letter than the charge was fraudulent. Tell them they must remove the original charge and any interest charges immediately.

Send a copy to the FTC. Tell BoA that you're filing a complaint against them with the FTC. Tell them that you suspect that BoA disclosed your account information to this credit protection service and that you believe it was a act of fraud on BoA's part as well as the part of the so-called merchant.

That should get their attention.

Once you've sent out that nasty-gram, call up BoA and politely ask to speak to someone that deals with account fraud. You should probably try to dodge CSR that answers the phone. Tell the rep that you sent a written dispute about some fraudulent activity on your account and that they sent you some bogus reply letter stating that they couldn't cancel a subscription with a merchant – which wasn't your complaint to begin with. Ask them if they handle all fraud complaints this way. If the rep hasn't handled your complaint by this point, tell him that the Fair Credit Billing Act only gives them 2 billing cycles to resolve such disputes. Also point out that if they fail to take your complaint seriously, they forfeit the right to collect anything.

If none of these efforts work, you can either write them and demand an arbitration hearing – assuming BoA has an arbitration clause – or you can sue them in small claims court.

- Joel

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