Unauthorized Card Charges: The $50 Cap

An unauthorized charge — someone used your card without permission — is different from a billing dispute over a wrong amount or an item that never arrived. Federal law limits how much you can be made to pay, but the cap and the clock depend on whether the card is credit or debit.

What counts as an unauthorized charge?

An unauthorized charge is the use of a card by someone other than the cardholder who doesn't have actual, implied, or apparent authority to use it, and from which the cardholder gets no benefit (12 CFR §1026.12(b)(1)(i)). That's different from a charge made by a family member or someone else the cardholder lent the card to — that use is generally considered authorized, even if the cardholder didn't expect that particular purchase.

Credit cards: the $50 cap

This protection applies only if the card is an accepted credit card, the issuer gave adequate notice of the liability cap and how to report a loss, and the issuer provided a way to identify the cardholder or authorized user on the account (12 CFR §1026.12(b)(2)).

Debit cards: the Regulation E tiers

How the bank investigates a debit claim

Under 12 CFR §1005.11, once you notify the bank of an error (including an unauthorized transfer), the bank generally has 10 business days to investigate and determine whether an error occurred. If it needs more time, it can take up to 45 days, but it must provisionally credit your account for the disputed amount (minus a maximum of $50) within those first 10 business days, and give you full use of those funds while the investigation continues. For accounts open less than 30 days, or for certain foreign or point-of-sale debit card transactions, the timeline can extend to 20 business days to investigate, and up to 90 days to resolve.

Reporting deadlines for a lost or stolen card

If the unauthorized charge is also a billing error

An unauthorized charge on a credit card also qualifies as a billing error under the FCBA. Many cardholders combine both paths: they report the loss or unauthorized use right away, and they also send the written billing-error notice within 60 days of the first statement showing the charge, to preserve every available protection. Our guide to how to dispute a charge walks through that written process step by step.

If the fraud claim is denied

An issuer or bank can conclude that a charge was actually authorized — for example, if it came from a known device or a chip-and-PIN transaction. That conclusion can be challenged: you can ask for the evidence the investigation relied on and submit a rebuttal with your own documentation. Our guide to fraud claim denied covers that specific situation in more detail.

Common mistakes to avoid

• ✕Waiting several days to report a lost or stolen debit card, losing the $50 cap tied to the 2-business-day window.
• ✕Confusing an unauthorized charge with a billing dispute over a wrong amount or a defective item — these are separate protections.
• ✕Not reviewing statements in time and missing the 60-day window to report an unauthorized charge that already posted.
• ✕Sharing an account number or PIN with someone who calls claiming to be from the bank.
• ✕Not reporting identity theft at IdentityTheft.gov when an account was opened by someone else.
• ✕Assuming debit card liability works the same as credit card liability — the deadlines and dollar amounts are different.

When to talk to a professional

Frequently asked questions

What is my maximum liability for an unauthorized charge on my credit card?

Federal law caps liability at the lesser of $50 or the amount actually used before you notify the issuer. Many issuers, as a matter of policy, charge nothing at all for verified unauthorized charges.

Why does my debit card have different rules than my credit card?

Debit cards are governed by the Electronic Fund Transfer Act (EFTA) and Regulation E, not the FCBA. Because the money comes directly out of your bank account instead of a credit line, the law uses a tiered system ($50, $500, no fixed cap) that depends on how quickly you report the loss.

What happens if I don't report my lost debit card in time?

If you report after 2 business days of learning of the loss, liability can rise to as much as $500. If an unauthorized transaction appears on your statement and you don't report it within 60 days of it being sent, you can become liable, with no fixed cap, for transactions after that period.

Is an unauthorized charge the same thing as a billing error?

An unauthorized charge is one type of billing error under the FCBA, but the $50 liability cap is a separate protection with its own legal basis. Many cardholders use both paths at once: reporting the unauthorized use right away and also sending the written billing-error notice.