Can you run a card on file for payment without approval?

Your Business Credit columnist Elaine Pofeldt
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, a website for independent professionals. She writes "Your Business Credit," a weekly column about small business and credit, for

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Question Dear Your Business Credit,
We are an engineering firm. Our customers typically make a down payment with a credit card for their drawings at the beginning, then when the drawings are final, they pay with a credit card for the final payment.

We worked recently with a customer on a project that started in March 2016 and closed in May 2016. Both times his credit card transaction went through without any problem.

I note on every single invoice with each payment of who had authorized the credit card transaction. On August 10, this same customer requested that my boss travel clear over to Wilson, Wyoming, from Rexburg, Idaho, to do an inspection for him. My boss did and gave him the verbal information that he needed.

When my boss got back to the office, I called the client to collect payment and he gave me a credit card number to run. I read it back like I always do. I tried it several times and it kept coming back, "bad number."

I called him back immediately, and he said that he had already left the office and asked me to call back in the morning. I did, and several times throughout the day, and the following days, all with no answer, even calling from different lines hoping the caller ID wouldn't show our name.

Since he gave me a bogus number to run on this open invoice, is it legal for me to run the card that we still have on file that went through before just fine? I will be looking forward to hearing from you. – Jeanine

Answer Dear Jeanine,
This situation is a bit tricky. Given that you worked with this customer before and his previous transactions went through with no problem, I’m not certain he was trying to commit fraud. It’s possible that he made an honest mistake in giving you what he thought was the correct credit card number and then faced an urgent personal situation after talking with you, such as a medical problem, that took precedence over getting you a new card number. Since this is a possibility, you’ll want to be tactful in how you interact with him.

That said, your company does need to get paid, particularly given the efforts your boss made to be accommodating. I asked Leslie Tayne, an attorney in Melville, N.Y., who specializes in small business debt and credit, if it would be OK for you to run the charges through on the other card.

“I would try to get authorization from the consumer for the card on file and send a letter in writing to them know that this is now outstanding and that you will be charging the card you have on file,” Tayne suggested in an email. “Since there is a card on file, I would run that once you send out the letter.”

You’ve already tried to get authorization to no avail, so it seems your next step is to send the letter explaining your intentions. If your customer intends to pay and has access to his mail at the moment, he’ll probably pick up the phone and call you with the new credit card number. I’d give him a few days. If there’s still no check in the mail, then you may want to act on Tayne’s advice and run the credit card. Your customer may not be happy about it, but if he complains, remind him about the efforts you made to reach him. A reasonable person will understand that your company needed to get paid. 

See related: How your business can avoid chargebacks, account problems, Businesses must beware unauthorized card use, Merchants hit by chargebacks look to hire help

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Updated: 04-24-2019