The Misused Authorization Fee is a fee that can be charged to anyone who has their credit card number stolen and used without authorization. For example, if someone steals your credit card number and uses it to make purchases on the Internet, you may be able to recover those costs from the bank or financial institution that issued you the credit card.
However, the bank or financial institution can charge you a fee for this service, which is known as the Misused Authorization Fee.
The Misused Authorization Fee does not apply to debit cards. It also does not apply to fraudulent charges that are made in person at a store or business by someone presenting your card without authorization. If you discover fraud in these cases, you should report it to your local police.
The Misused Authorization Fee is typically $50 but may vary by bank or financial institution. You can ask about this fee when you apply for a new credit card or open a new checking account, and any time thereafter. As part of the service they provide in the event of unauthorized use of your credit card, they should provide you with a written explanation of this fee.
In addition, if you contact your bank or financial institution to report the unauthorized use and request reimbursement, they may require that you submit paperwork documenting all of your costs. This may be a credit report or receipt from the company where the unauthorized charges were made.
The following are tips to help you reduce the chance that your credit card will be misused by identity thieves:
- Closely monitor your account activity and report any fraudulent activity through both the web site of your financial institution or bank and at least one of the three major credit reporting agencies (Equifax, Experian, TransUnion).
- Save receipts for all purchases.
- Never disclose your account PIN or full Social Security number to anyone. Identity thieves have very sophisticated methods of obtaining this information. The bank cannot protect you if you provide this kind of information to someone pretending to be from the bank or a company the bank may do business with, such as a telemarketer or telephone marketer.
- Keep your account information accurate and up to date at all times, even if you have not received a new card in the mail recently. This will reduce the chances that an identity thief can use a duplicate or “cloned” card with a fictitious account number issued on the original credit card.
- Always sign your credit card; never allow another person to use your card.
- If you discover that someone has opened an account with the same social security number as yours, notify both the bank where you have accounts and the Social Security Administration (SSA). Close existing accounts at your bank. Then contact the creditor of the account opened in your name and request that a Fraud Alert be placed on your credit file. This will prevent creditors from granting additional credit because of the fraudulent account that has been created in your name.
- If you believe someone has accessed or is using your consumer reports without authority, contact all three major credit reporting agencies to place a fraud alert on your credit file. The fraud alert tells creditors to contact you before opening any new accounts or changing existing accounts.