According to the FTC, credit card fraud ranked as the second most common type of identity theft in 2020. Identity theft and fraudulent activity can be devastating, especially when accounts are locked or closed until you can verify your identity or report the fraud. So what can you do if your account has suspicious activity or you have been the victim of fraud? We explain.
Checking accounts have federal protection against fraud thanks to Federal Reserve Regulation E. Unfortunately, Chime is a financial technology company under the Bancorp Bank. Chime is not a bank itself, so Chime is not subject to these federal regulations or consumer protections. Chime instead gives members optional savings accounts and spending accounts through secured credit cards. So people can make deposits and then use the credit or debit cards to rebuild their credit history with only the money in the account, and any fraud liability is subject to change.
According to one of their help articles, all disputes are investigated immediately. During the investigation, Chime sends a chargeback request to the merchant. This is a way to ask the merchant nicely to give the money back while the investigation is pending. However, the merchant has 30 days to respond, and they can choose to reject that request and provide evidence that the transaction was legitimate.
Chime might give you provisional credit while they investigate. When they conclude their investigation, you either get to keep the provisional credit or take it back if they did not find evidence of fraud within five days. Your account’s provisional credit shows up within ten business days, not immediately. They also don’t have provisional credit for all disputes. You have to file your complaint about fraud or dispute a transaction within 60 days, or it doesn’t qualify for provisional credit. The fine print stipulates that any disputed charge that falls under Regulation Z is not subject to provisional credit. Regulation Z pertains to compensation for Loan originators and mortgage brokers.
If you have a problem with your account, you must contact Chime immediately to report fraud. Unfortunately, getting a hold of someone at customer service is difficult because they only have one customer service line for all of their issues and try to redirect most problems to online support articles.
Choose from their drop-down menu of support options. For fraud, you can call Chime right away using the regular customer service number at 1-844-244-6363, use the mobile app to contact the support team directly or send an email to: firstname.lastname@example.org.
If a scammer gets a hold of the account number for your Chime credit card or savings account, because it is a secured credit card, they can spend what you have in savings, make fraudulent purchases, and even move money around.
Chime states that they investigate every dispute filed for fraud. Unfortunately, this has led to conflicting results, often manifesting in unintended consequences for consumers. Reports indicate that in the last year alone, Chime has had over 1,400 complaints to the Consumer Financial Protection Bureau about:
Like most financial organizations, Chime uses software to identify suspicious activity and flag it. However, the software flagged legitimate transactions for hundreds of accounts at once and closed their accounts without warning, cutting customers off from accessing any money they had.
Chime is not a bank and therefore is not regulated as one. Many people used this company to help rebuild credit during the pandemic, but unfortunately, consumers didn’t get the same fraud liability protection without the same protections as a bank.
Still not having any luck with Chime? If you aren’t getting a response or the response you get isn’t satisfactory, you have other legal options. You can file a complaint against Chime. You can try to sue Chime in small court, even if you can’t join lawsuits against them. Alternatively, you can use consumer arbitration.
Share your complaint about Chime with FairShake today.