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Cardholder Dispute
Question: If a cardholder states a charge(s) is "unauthorized" and a dispute form is sent to request additional information and the cardholder fails to respond can the cardholder be held responsible for the charge(s) or does the bank have to continue to work the issue?
Answer: The notification rules of 12 CFR 226.12(b)(3) give protection to the cardholder for giving notice to the creditor. The method of notification may be "in person, by telephone or in writing" at the option of the person giving notice. This means that the customer can choose how to reach you. Unlike Regulation E, you may not specify that the notification be in writing. Only if you request information from the customer that is necessary to the investigation and the customer fails to respond may you consider that the customer has withdrawn the notice. And even then, we strongly recommend renewing the effort to obtain information from the customer.
Copyright © 2005 Compliance Action. Originally appeared in Compliance Action, Vol. 10, No. 14, 12/05
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