Elaine Pofeldt is a journalist whose articles on entrepreneurship and careers have appeared in Fortune, Working Mother, Money and many other publications. She is a former senior editor at Fortune Small Business magazine and an entrepreneur herself, as co-founder of 200kfreelancer.com, a website for independent professionals. She writes “Your Business Credit,” a weekly column about small business and credit, for CreditCards.com.
Dear Your Business Credit,
I had an incident recently in which a business charged my credit card without my knowledge or authorization.
In October 2016, I called for a taxi and gave them my card because they had to charge me before dispatching the driver. I ended up calling back and canceling my taxi. They refunded me the money and that was that, or so I thought.
In May 2017, I was charged by this same taxi place and I didn’t use its service. I called the business to clear it all up, and I was told that in 2016 I was refunded too much money and because of the error on the taxi firm’s part it took the money from my bank account seven months later.
To me, this is an unauthorized charge and one that should be disputed with my bank. The taxi company can’t access my money seven months later without my permission because its employees realized they made a mistake, can they? – Abby
Hmmm. It sounds as if you used a debit card, rather than a credit card, given that the taxi service took the money from your bank account. I am not clear from your note on whether you agree the taxi service did refund more than you were charged.
If the taxi company did give you too big of a refund, then the honest thing to do is let it recoup the extra money it gave back to you, regardless of how much time has passed.
Given all of the competition from ride-share companies like Uber and Lyft, it’s not an easy time for traditional cab companies to survive – and sometimes every dollar counts toward their survival. I would not recommend disputing an honest charge, even if it was made later than you expected.
What if the firm refunded the exact amount you paid and are now saying they refunded too much? Then you have some grounds to dispute the charge. Did the company explain its reasoning for saying you were refunded too much?
The only explanation I can envision is that the company was supposed to charge a cancellation fee and forgot to deduct that from the refund. Trying to go after it now is a little petty on the cab company’s part, but if the business is operating on very thin margins, the owners may not have much choice.
If you believe the company is charging you money you don’t owe and can’t provide a reasonable explanation, I would ask the card issuer to investigate. If the cab company has no logical justification for the charge, the card issuer is likely to see your point.
Bear in mind, however, that there are often greater protections for those who use credit cards than debit cards when it comes to disputing a charge.
As the Federal Trade Commission puts it on its website:
“The consumer protections for a debit card differ from protections for a credit card. You may not be able to dispute a debit and get a refund for nondelivery or late delivery. Still, some debit card issuers may voluntarily offer protections and solutions to problems like not getting merchandise you bought with a debit card.”
The FTC recommends contacting your debit card issuer to find out more about its policies in the event you want to dispute a charge. The agency also has published a sample letter on its website that you can use to dispute a debit-card charge.
A hint for the future: Don’t use your debit card for purchases with this cab company. It sounds as if the way it processes transactions is a little disorganized. Pay cash or use a credit card. You don’t want to risk a sudden debit from your bank account for a purchase you didn’t make. That can lead to unexpected overdrafts.
See related: What happens if you overpay your credit card bill
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