• Consumers are protected with the Fair Credit Billing Act.credit card detail image by gajatz from Fotolia.com
  
  Credit cards are the way business is conducted in the United States, whether in person or on the Internet. The Fair Credit Billing Act, enacted in 1975 as part of the Truth in Lending Act, provides some consumer safeguards. A chargeback protects the cardholder from fraud, but you as the consumer must know and follow the rules.
  
  

Billing Error Chargeback

• A chargeback reverses the original charge process and goes from you to the credit card to the merchant, reports credit card.com. Charges you did not authorize or charges for undelivered goods or services may be under the class of "billing errors." You have 60 days from the date of the first statement that includes the charges to protest the charge. You may deal with the merchant first if you ordered goods not received. If you are not successful at that level, you may call the number on the back of your credit card and ask about a chargeback. Some credit-card companies are receptive to this approach; others may require a letter with all the facts in writing. The Federal Trade Commission provides a sample letter for a billing error. You can find a copy on the California Attorney General's website at ag.ca.gov.
  
  

Claims and Defenses Chargeback

• Amounts over $50 may come under the "claims and defenses" clause that gives you up to one year to protest the charge. This refers to Section 170 of the Fair Credit Billing Act. The merchant cannot be more than 100 miles from you or outside your state of residence, but some states like California consider telephone and written orders made from home as transactions that occur in your home. You must attempt to negotiate with the merchant before asserting a claim with the credit card company and you must not pay the bill. You must have an outstanding balance in the amount contested, but you may contest less than the total.
  
  

Procedure

• Keep your receipts for all transactions and retain credit-card billing statements. Try to dispute within 60 days of the statement date for maximum benefits. Do not pay the bill if you are outside the 60 days. Contact the merchant first and ask for a refund. Write a complaint letter and make a copy for your records. Contact your credit-card company and dispute the charge. Complete any forms requested and supply documentation for your claims. The credit-card company should respond within 30 days, and you may find the charge deleted from your bill.
  
  According to the Federal Trade Commission guidelines, the company has 90 days or two billing cycles to settle the dispute. If no resolution is forthcoming, file a complaint with the attorney general of your state.