WalletHub, Financial Company
No, you don’t have to pay for unauthorized credit card charges by family members, at least in most cases. If someone takes your credit card and uses it without permission, that’s considered fraud. It doesn’t matter whether they’re family, a friend, or a complete stranger.
Legally, you can only be held liable for $50, as per the Fair Credit Billing Act (FCBA). But all major credit card issuers give you a $0 fraud liability guarantee. So, as long as you report the charges, there shouldn’t be any issue. There are just a few details you need to know first.
Here’s how to handle unauthorized credit card charges by a family member:
- Ask that person for payment. If they’re willing to give you the money, you may not need to dispute the charges, and you can give them a warning not to do it again. That could eliminate a lot of the hassle.
- Contact your issuer. If your family member refuses to pay you back, you should report the incident to your credit card company. To do so, you’ll need to file a dispute. Once the company investigates the situation, they will issue you a refund if they agree with your claim.
- File a police report. This may or may not be necessary. Your card’s issuer may require you to do it in order to approve your claim of fraud. Or you might need to file an identity theft report with the Federal Trade Commission (FTC). It’s understandable if you don’t want to report your family to the authorities, but it’s possible you could end up being liable for the charges if you don’t.
The only other time you might be held liable for unauthorized charges by a family member is if that person is an authorized user on your card and simply bought something against your wishes. Any purchases by an authorized user will not qualify as fraudulent. So, you may want to consider limiting the amount your authorized users can spend. Some cards allow you to do that through your online account.
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Stacy Faraday, Member
If they used their authorized user, then it's not fraudulent. If they just stole your card and bought stuff, then you can file a dispute, and refund the money.
At the end of the day though, it would be best to just get the money out of him. Make him mow the lawn for like 40 years or something.
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