How to dispute charges through your credit card

Posted at 10:01 on Thursday January 05, 2006 | Filed Under Stories about customer service

A few weeks ago, I wrote about my epic ordeal canceling Sprint service and moving to Cingular (because of reception in a new house):

But then they told me my account had a $160.00 charge. For what, I asked? Wait for it...
"An early cancellation fee."

Yeah, right. I knew I didn't have a contract, and I had negotiated out of an early cancellation fee a long time ago. Cellphone companies make a lot of money from trying these shady moves, hoping customers will get frustrated, give up, and just pay.

[...]

As soon as I read these notes out loud, I witnessed a miraculous change in her ability to waive the fee. Within 2 minutes, my account was cleared and I was off the phone. Amazing!!!!! Thank you madam!!!

See the full article: Sprint tries to rip Ramit off? Oh my.

But here's the clincher: Although I thought I was done dealing with them--and they told me they wouldn't charge me--they did it anyway.

By this point, I was so fed up that I called in the big guns.

Many people don't know that your credit card offers you excellent consumer protection. This is one of the reasons I encourage everyone to make major purchases on their credit card (not cash or debit).

I called my credit card and told them I wanted to dispute a charge. They said, "Sure, what's your address and what's the amount?" When I told them, they instantly gave me a temporary credit for the amount, and told me to mail in a form with my complaint.

I did so, including my notes and everything. 2 weeks later, the complaint was totally resolved--in my favor. In other words, that temporary credit became permanent, and I didn't have to pay. Sprint had to eat the cost. And rightfully so, those jackasses.

What happens in disputes like this is that the credit card will go fight the merchant for you (it works with all major credit cards). This is the 1st or 2nd time I've ever had to do this, so I recommend waiting for something major. But in the case of Sprint, which had consistently lied, I was tired of it and decided to let the credit card company handle it. Keep this in mind for future purchases.

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Comments (20)

1.: Do you think credit card companies will risk merchant's ire by fighting them all the time?

Once had to go through the same script with AMEX in a dispute against a lousy long distance provider (merchant). I got the credit back after a lot of hide and seek. The way I won was by investing my time :( (because I wanted to teach lousy merchant a lesson). I repeated the dispute process 3 times and the lousy long distance provider gave up.
Every time AMEX checked with the merchant, the merchant responded stating that the charge was valid and AMEX believed the merchant!

AMEX was not helpful to the _extent_ that you seem to think.

Posted by Ravi Char at January 5, 2006 11:34 AM

2.: You can do this directly on the American Express website. I've disputed many charges in the past (over 10) and once I even received additional money back that was labeled "class action" on my statement. I agree, don't waste your time arguing on the phone when your credit card company will do it for you.

Posted by Tark at January 5, 2006 11:36 AM

3.: Interestingly enough, this did not work for me on a measly little $9.95 charge fraudulently applied to my Bank Of America CC by scammers. I'm stunned, especially after I spent a half hour(!) on the phone with them filing the complaint. I filed the complaint Dec 9, and as of two days ago, it was still not refunded.

I blogged about this issue heavily on my website, http://fearlessmoney.com

Posted by Bruce Kroeze at January 5, 2006 11:40 AM

4.: Ramit, maybe you or your blog readers can help me in my situation.

I signed up with SBC DSL on Oct 28 when they had this $14.99 promotion going. I was connected only towards the last week of Nov because of the phone number transfer etc. Since Nov 1, their rates had shot upto $16.99.

SBC now bills me for $16.99 even though I signed up befor e the other deal expired. When I call them they tell me that there are no 'notes' in their system that I signed up when I did and they refuse to even hear my case.

Its not about the extra $2 per month that I am having to pay, its about a major company honoring their commitment.

Is all lost?

Thanks in advance.

Posted by Sripathi at January 5, 2006 01:36 PM

5.: I've protested quite a few charges to both my MasterCard and American Express cards, and in each case I've been successful. In one case, I had been overcharged by the Palms in Vegas, and after disputing the charge, having it removed, the Palms re-charging my card (twice), American Express agreed to eat the charge itself rather than risk losing a customer. I guess casinos won't quit when it comes to money (even where it's more expensive to keep fighting), but credit card companies know where the economic "line" is in handling customer disputes.

Posted by Jay Gatsby at January 6, 2006 06:55 AM

6.: I would suggest you to call back and try another CSR. it's all in the manner of how you talk to them. eventually you should reach a helpful customer service rep.

is the DSL plan a 1 yr contract? because if not, you can always do the "okay cancel my service" routine and go from there.

its a shame that you may have to spend quite a bit of time just to get them to honor their prices.

Posted by Cap at January 6, 2006 07:37 AM

7.: Regarding your encouragement to use a credit card, debit cards must provide the same protection as credit cards. The advantage with that is that you can now make purchases without going into debt just to be "protected".

Posted by Gregory at January 6, 2006 08:17 PM

8.: well with a debit card you are usually dealing with your bank, as to credit card.. you may have the support of a national cc issuer.

they both can be the same, of course. but you should realize that doing a chargeback via a debit card is different than doing it with a credit card.

I never make large ticket purchase with a debit card..

with a cc purchase you really do get more protection, not to mention the benefits associated with the card (warranty extension, buyer protection, etc. etc.)

course I know what youre talking about too, responsible credit usage is still important.

Posted by Cap at January 7, 2006 03:30 AM

9.: Normally, if you call your credit card company, they will do a chargeback. This automatically freezes the funds so that the merchant has no access to the money. My mom had a dispute once with true.com, where they billed her debit card even after she canceled the service. First, they preyed on her because they thought she was an unknowing consumer. I got on the line and advised them that we'd do a chargeback with the credit card company, and they immediately corrected the issue. Large companies assume that the little guy doesn't know what they're talking about. And they didn't even know that it was a debit card.

Posted by Roberta at January 8, 2006 09:34 PM

10.: Sprint may get that chargeback and add it back to your "account" as money you owe them. So you aren't necessairily in the clear yet. You still need to resolve the charge with them, lest you wind up with a collections agency knocking on your door.

Posted by Bill at January 9, 2006 07:41 AM

11.: As a retailer, I can attest to the fact that credit card companies are absolutely on the consumer's side in these mattters. In any case of mistake or fraud, the cc companies place a huge burden of proof on the business that puts through the charge. So do dispute anything unfair.

Posted by Catherine Hooper at January 9, 2006 09:34 PM

12.: I just went through this same ordeal. Execulogo, an online logo design company we were using for our start-up company, delivered super crappy work. They had a money back gaurantee, but when I tried to get our money back they just ignored me. After a month of trying I contacted my cc company and now I have my money back.

Posted by Jared Iverson at February 2, 2006 02:14 PM

13.: Had a fradulent parking charge added to my hotel bill in NYC ($37/day at Hotel Pennsylvania). After two weeks of stalling tactics by the hotel, I finally wised up and called Discover. The hotel didn't dispute the reverse charge.

Posted by Greg at May 3, 2006 11:32 AM

14.: I purchased an entire package of stock investing classes through a company called Teach Me To Trade. $20,000 worth that included a mentoring program. They had a 3 day cancellation policy that I signed. Long story short, The mentoring program did not include any phone support. I battled with Teach Me To Trade and they said the phone support was $3,500 extra. I was livid to think there wasn't one person with stock trading knowledge I could call and of course it took almost 1 month to find all of this out after getting the run around. The 3 day policy ended quickly. I have disputed this charge with American Express 3 times and all they tell me is too bad. The only saving grace is my other credit card company in which I put $5,000 of it on did reverse the charges. I documented everything to a tee and American Express failed me. I will never use them again. I will conitnue to fight. KL in Sacramento

Posted by Kit Langstroth at May 20, 2006 01:52 PM

15.: My experience with VISA. (Long history sort) A projector bought by Internet. One month later, I was said that they can not bring me. Bought cancelled. Several months later, the VISA is charged with the no-sent projector.

I call VISA, and they say that it is my problem, not theirs. I press to the company that wrongly charged the projector and to VISA.

The money is charged on my card, and at the end of the month the money is charged on the associated bank account. The official position of VISA was _always_ that it is not their problem. The bank (Barclays) neither solved anything; there I was said that they have not time to worry with my problem (a 1500US$ bill of a thing that I have not received) I have never used again this card, I take away from the bank all the things that I have here (stocks and mutual funds); the only thing that stays there is the mortgage (the cancelation fees make really expensive move it; and, anyway, the interest rate is bellow inflaction. This is a clean case of "last mile", they did to a great morgage for me loosing money for me to be on the bank and bought other products, and as soon as I have a problem, the have not the kind of people to be friendly).

Posted by David Santo at August 12, 2006 02:02 AM

16.: I do agree that there are some charges definitely worth fighting for. On the other hand, my cousin owns an online store and tells me terrible stories about people. People will order an item and he ships it out. Then a day later they want to cancel the order even after they have already received the tracking number. He tells them it has already shipped and they can return it for a refund less shippping cost. They don't want to pay for return shipping so they refute the CC charges. They always favor the consumer and immediately reverse the charges. Even with proper documentation, they give him a big "don't care - you lose" attitude. So not only are the charges reversed, but the consumer also has the merchandise! The bottom line is - CC in general are getting way out of hand - what happened to the good old days of money orders and checks?

Posted by Cynthia at September 3, 2006 11:21 PM

17.: feel good about your refund all you want, but the only real winner in the larger picture is VISA, MC, AMEX, etc and their issuing banks. They add more and more protection over time to the customers at the expense of merchant, convincing customers that buying with CC is the right thing to do.

Well, now that CCs are obiquitous, merchants must accept them--but merchants must agree to bear all fees etc, and be at a disadvantage to the customers because of CC protection. Everytime a CC user files a charge back, the merchant gets charged $20-$50 no matter who wins.

For a merchant to stay in business, this extra fee (aong many others) must be embedded into the cost of goods. US consumer debt is at a all time high--people spending more than they can afford, merchants are at the complete mercy of CC comapnies especially regarding online purchases because it's harder to prove customer fraud.

so who really wins? it's the CC companies and Banks, they get customers to spend more than they can afford thereby earning interest, AND they charge the hell out of the merchants. merchants now have no choice but to comply because consumers are convinced that CC is the way to spend. the only thing the CC companies and Banks really care about are your interest payments and merchant's fees. whatever justified "protection" they can come up with for the consumers is all to that end.

I am not against the consumer protection as it is definintely necessary, but with the current relationship between CCs, merchants, and consumers,--it's all in the control of the CCs.

Posted by alex at September 29, 2006 12:50 PM

18.: All that talk about banks, and card card companys. Until Americans with credit cards start cutting them up and sending the cut up credit cards back and start using cash or money orders the banks and credit card companies will continue suck your money in interest.

What happen to good old cash. Too many middle class Americans are trying to keep up with the Joneses by using credit cards. Wake up middle class, wake up. Become savers and stack up on cash money and stop making the banks and credit conpaines richer. It up to you middle class America if you keeping sinking or swim way above water.

Food to think about. A fool and his/her money will depart.

IWJ

Posted by I. Walter Jones at October 13, 2006 12:21 PM

19.: one more thing about sprint.

they try to make sure, you dont have a written trail of communication between you and them. they will also make sure the "chat" with sprint representative is never working.

Posted by jambhu at January 8, 2007 01:41 PM

20.: I am in a full scale revoult attack against SPRINT for all out Ganster Style Tactics of Corralling by, surveys to collect, give you a SPRINT plan, billing and the dubious thoughts of credit damage if you donot comply. I want restitution, not just complaining for the eight months and twenty days of hell I've been through with them.

Posted by FERN FAULKENSTEIN at January 29, 2007 03:12 PM

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