What is the Fair Credit Billing Act?
The Fair Credit Billing Act (FCBA) is a federal law that helps protect consumers in California from unfair billing practices by creditors. It requires creditors to follow certain procedures when billing for goods and services purchased with credit, as well as when consumers make complaints about billing errors. Under the FCBA, creditors must provide consumers with an explanation of their rights regarding billing errors, correct any errors promptly, and not report inaccurate information to the credit bureaus. If a creditor doesn’t follow the procedures required by the FCBA, consumers can sue the creditor and recover their damages, including court costs, attorney’s fees, and actual damages up to $1,000. The FCBA covers any billings made using a credit card, including phone, internet, and mail orders. Consumers can dispute errors that appear on their bills, such as incorrect amounts, incorrect billing dates, or incorrect descriptions of goods or services. The FCBA also requires creditors to provide an investigation and a written notice of the results if a dispute is raised within 60 days of the first statement that includes the error. The FCBA is enforced by the Federal Trade Commission, and consumers are protected under the law regardless of their credit score or financial standing. If the creditor violates the terms of the FCBA, the consumer may bring a lawsuit to recover damages. This law, therefore, helps consumers in California maintain their rights against unfair credit billing practices.
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