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Fair Credit Billing Act (FCBA)

The Fair Credit Billing Act (FCBA) was established as a federal law in the United States as an amendment to the Truth in Lending Laws.  The law is designed to provide consumers with protection against unfair billing practices and sets guidelines for correcting mistakes on credit account billing statements.

Some examples of billing errors which are covered under the FCBA are:

  • Charges not made by the credit card holder
  • Charges processed with the wrong amount
  • Charges for products or services not received by the consumer
  • Charges for goods not delivered as agreed, or were damaged upon delivery
  • Failure to properly apply or report payments or credits to an account
  • Improper calculation of payments 
  • Charges that need clarifying or that the consumer requests proof of 
  • Statements which are mailed to an incorrect address

The FCBA allows credit card holders to dispute any charges they believe to be false within a 60 day period.  This dispute must be done in writing and mailed through the United Postal Service to the billing inquiries address provided on their credit card statement.  Once received a chargeback is sent to the vendor.  The vendor then has 90 days to investigate and either provide documentation as to why the charge is valid or allow a credit to be returned to the consumers account.  There are also a number of guidelines and time frames that creditors must adhere to in regards to timely and accurate billing.

The FCBA is governed by the Federal Trade Commision as the enforcing agency which provides administrative enforcement to financial institutions.  Financial institutions may be held civilly liable for damages in individual or class action suits, however limits on both apply.

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