Can a Dispute Be Denied? Reasons and What to Do Next

A dispute is a formal challenge to a transaction or billing error on an account statement. Consumers initiate these challenges with a financial institution, such as a credit card issuer or bank, when identifying an unauthorized charge, incorrect amount, or issues with goods or services. While consumers have the right to dispute charges, these disputes are not always successful. Disputes can be denied, leaving the original charge on the consumer’s account. This article explores the common reasons for such denials, the information needed to strengthen a dispute, and the actions consumers can take if a dispute is denied.

Common Reasons for Dispute Denial

Disputes can be denied for various reasons, often related to the evidence provided or the nature of the claim itself. Insufficient evidence is a frequent cause, occurring when the consumer fails to provide adequate documentation. For instance, without receipts, communication records with the merchant, or proof of return, a financial institution may find it difficult to side with the consumer.

Another common reason for denial involves timeliness issues. Financial institutions and card networks establish specific timeframes within which disputes must be filed. For billing errors, consumers have 60 days from the statement date to notify their card issuer. For other issues, like problems with goods or services, the timeframe extends up to 120 days from the transaction or expected delivery date. Filing a dispute outside these established windows can lead to an automatic denial.

Disputes may be denied if the reason falls outside dispute resolution policies. Buyer’s remorse or general product dissatisfaction without a defect or delivery failure are not valid grounds. The dispute must align with specific reason codes established by card networks.

Strong merchant evidence can also lead to a dispute denial. If the merchant presents documentation proving fulfilled obligations (e.g., delivery confirmations, signed contracts, communication records), the financial institution may deem the original charge legitimate. The consumer may have authorized the transaction, or failed to attempt resolution directly with the merchant first, which can also result in a denial.

Essential Information for a Strong Dispute

Building a strong dispute requires careful preparation and documentation. The foundation of any dispute includes precise transaction details, such as the date of the transaction, the exact amount, the merchant’s name, and any relevant transaction identification numbers. This information helps the financial institution quickly identify the disputed charge.

Comprehensive communication records with the merchant are important. This includes copies of emails, chat logs, or detailed notes from phone calls, noting dates, times, and the names of individuals spoken to, all demonstrating attempts to resolve the issue directly before escalating to a formal dispute. Even if attempts to contact the merchant were unsuccessful, documenting these efforts can strengthen a case.

Supporting documentation directly related to the issue provides concrete evidence. This can include receipts, order confirmations, screenshots of product descriptions, service agreements, or photographs and videos of damaged goods. For non-delivery claims, proof of non-receipt or tracking information indicating failure to deliver is valuable.

A clear, concise written explanation of the issue is necessary. This statement should articulate precisely what went wrong and why the charge is being disputed, without extraneous details. Financial institutions provide specific forms or portals for disputes, and while these guide the process, the underlying information gathered forms the basis of the claim.

Next Steps After a Denied Dispute

If a dispute is denied, the first action involves carefully reviewing the denial reason provided by the financial institution. Understanding the specific grounds for denial is important, as it informs the subsequent course of action. The denial notice should explain why the claim was rejected, and consumers have the right to request supporting documents that led to the decision.

Consumers can appeal the decision with their financial institution, especially if new information or evidence addresses the reasons for the initial denial. An appeal involves submitting this additional evidence and a clear explanation of why the original decision should be reconsidered. Issuers provide a timeframe to initiate an appeal after receiving the denial explanation.

For unresolved issues, escalating the complaint to relevant regulatory bodies is an option. The Consumer Financial Protection Bureau (CFPB) handles complaints related to various financial products and services, including credit cards and banking. Consumers can file a complaint with the CFPB online, providing details of the dispute and the denial. State Attorney General offices also have consumer protection divisions that may mediate complaints or take action against businesses engaging in unfair practices.

A final attempt at direct merchant resolution might be considered, particularly if new information has surfaced or if the financial institution’s denial provides specific insights into the merchant’s defense. For larger or more complex disputes, consulting with an attorney specializing in consumer law can provide guidance on legal options, such as arbitration or small claims court, to pursue the matter further.