Unauthorized Credit Charges: What to Do

What to Do When You Discover Unauthorized Charges?

Imagine this: You've paid with a credit card for a certain service, and the business owner continues to charge you beyond the agreed amount. You have no written contract or record of your conversation. You approach them, and they claim the charge is legal. What do you do?

In this case, the client discovered to their surprise that the business owner continued to charge their credit card without further consent. The charges persisted despite the client not authorizing them, and the business owner claimed they were legal. The client felt helpless.

The most important point is that not having a written contract does not allow the business owner to charge money at their discretion.

What Does the Law Say About Credit Card Charges?

Israeli law requires business owners to inform the consumer of all the terms and costs involved in the service or product they provide. Even if there is no written contract or record of the conversation, this does not mean the business owner can charge money at their discretion.

The Consumer Protection Law, for example, obligates business owners to disclose all relevant information to consumers before charging. It also stipulates that the business owner must stop charging once the consumer requests it, and if they don't, you can contact the credit company to cancel the transaction.

When Is This Relevant — Checklist

✓You've received an additional charge after agreeing on a fixed price
✓You have no written contract
✓The business owner claims the charge is legal
✓You've tried reaching out to the business owner and they aren't cooperating
✓You've contacted the credit company and they didn't help

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The Applicable Law: Consumer Protection Law

חוק רלוונטי

Consumer Protection Law

Requires full disclosure of all costs and terms of a transaction

States that charges without consent are a criminal offense

The Consumer Protection Law obligates business owners to inform the consumer of all the terms and costs involved in the service or product they provide. If the business owner does not comply with these conditions and continues to charge, you can contact the credit company to cancel the transaction and even consider filing a complaint with the Consumer Protection Authority.

Questions Everyone Asks — And No One Asks the Lawyer

Can the business owner continue to charge me without consent just because there's no written contract?−

No, the law requires the business owner to get your consent for each charge. Without consent, it's an illegal charge.

How do I know if the charge is legal?−

The charge is legal only if you agreed to it in advance. If you haven't given consent, the business owner must stop charging.

What to do if I've already been charged without consent?−

Immediately contact the business owner and ask them to stop the charge. If that doesn't help, contact the credit company to cancel the transaction.

Will canceling the transaction cost me money?−

No, if the charge is illegal, the credit company shouldn't charge you for canceling.

How to avoid such situations in the future?−

Always ask for a written contract and document every agreement. In case of a dispute, this will serve as proof.

Real Situations — Which Side Are You On?

You are a freelancer, and someone charges you money without consent — this is an illegal charge.
You are a business owner, and a client claims an overcharge — check their consent in advance.
You paid in advance for a service, and the business owner continues to charge — you are entitled to a refund.

What to Do Right Now?

Contact the business owner in writing and ask them to stop the unauthorized charge. Document all conversations and agreements, and contact the credit company to cancel the transaction. If you don't, the charges will continue, and the situation will worsen.

If you do nothing, you may continue paying for services you didn't request and find yourself in unnecessary debt. Act now to protect yourself and your money.