Electronic fund transfer using a debit card relieves shoppers of the hassle of writing checks, carrying large amounts of cash and making frequent trips to the ATM. But when someone gets your personal debit card information, this can result in fraudulent charges to your account. And your liability for unauthorized purchases may not be limited if you don't report the fraud in a timely manner.
Contact the financial institution that issued your debit card immediately by phone or in writing. Under the Electronic Funds Transfer Act, the institution has 60 days to investigate fraudulent charges after the date the first statement containing them is mailed to you.
The Federal Reserve Board notes that if you report the fraud within two business days, liability is limited to $50. If you report it after that, you could face liability of up to $500, and if you report it after the 60-day window, subsequent fraudulent charges can wipe out your account entirely.
Have the relevant information available for your financial institution if speaking by phone or writing a letter. The FRB advises giving your name, account number, date and amount of the debit card fraud(s), and the reason you believe the charges to be fraudulent.
Expect to have your case resolved within 45 days, or 90 days, if your account is new (less than 30 days old) or if the fraudulent charges were point-of-service or foreign transactions. Your bank may replace the money wrongly taken from you pending investigation and outcome.
The Federal Trade Commission advises you to never give out your debit card number over the phone when making a purchase unless you know you're dealing with a reliable company.
The Electronic Funds Transfer Act governing debit card transactions is different from the Fair Credit Billing Act governing credit card use; under the FCBA, your liability is limited to $50, no matter the total amount of the fraudulent charges made to your credit card.
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