How to Stop Unwanted Debit and Credit Card Withdrawals

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Putting payments on auto pay is quick and convenient. However, convenience often comes with a big price. Some shady service providers decide to continue to charge your card long after a service has been cancelled. Other times, you may have signed up for a service you didn’t even know you were getting. Hidden subscription were one of the top consumer complaints for 2015. What should you do if you can’t seem to get a recurring subscription to end?

Contact the merchant

Your first step should be to get in touch with the merchant. Make it clear you no longer want the product or service and you are revoking your authorization for them to withdraw payments. Also make sure to cancel your contract with the merchant. Even if you call and speak with a representative you should also send a written statement confirming your request. Bank of America has a sample letter here. If the merchant continues to make withdrawals from your account after you have revoked your authorization, your next step is to dispute the charges with your bank or credit card issuer.

Notify your bank or credit card issuer

Contact your bank at least three days before the next scheduled transfer. Let them know the merchant is no longer authorized to make recurring withdrawals. You may be asked to send written confirmation of your decision to revoke authorization within 14 days. If you don’t comply with this request the bank will not be responsible for stopping future withdrawals.

If a merchant continues to charge your credit card, you’ll have a maximum of 60 days to dispute the charge with the credit card issuer. The timeline begins with the date the card issuer sends the statement with the unwanted charge. Make sure to put your merchant dispute in writing and mail a copy to your credit card issuer.

File a complaint

Source: iStock

Source: iStock

If you have followed all the proper steps but your bank will not help you resolve the issue, you have several options. You can start by filing a formal complaint with the Office of the Comptroller of the Currency. Online complaint forms are available here. If you have additional questions about their compliant process, call the OCC at 1-800-613-6743. In addition, the Consumer Financial Protection Bureau accepts complaints about financial products and services. The Federal Deposit Insurance Corporation also has a hotline available (1-877-275-3342) if you have questions about stopping a payment. In addition, you can send an email.

Steps to protect yourself

Once you’ve resolved the issue, take steps to reduce your chances of this happening again.

1. Research any company you’re thinking of doing business with

When you agree to let a company take money from your bank account, you will be required to provide your checking account or debit card information. Make sure this sensitive data is in the hands of a trustworthy establishment. Conduct a search of online reviews. Also check to see if any formal complaints have been made against the merchant. One good place to start your search is with the Better Business Bureau.

2. Familiarize yourself with the terms of agreement

Know that the company is required to give you a copy of the payment authorization terms. This authorization outlines the agreement you made to let the merchant withdraw money from your account. It is your responsibility to make sure that you not only understand the agreement but also keep a close eye on your account to make sure the correct amount is withdrawn. The Federal Deposit Insurance Corporation notes that even if your bank or credit card issuer stops certain payments, you may still be legally required for some payments. For example, if you sign a contract to pay for a service for 8 months and you cancel before the term is complete, you may still be responsible for the entire amount.

3. Know your rights

The Consumer Financial Protection Bureau says a company can’t require you to repay a loan through automatic withdrawals from your bank account as a condition for granting a loan. One exception, however, is if the loan is an overdraft line of credit. You should be leery of any company that tries to convince you to use automatic debit.

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