Cardholder Liability Framework
Canadian cardholders generally have zero liability for unauthorized charges when the cardholder has taken reasonable care to protect the card and PIN. Network rules (Visa, Mastercard, Amex) implement the zero-liability policy. The issuer typically reverses the charge after a preliminary review.
The cardholder is required to report the unauthorized charge promptly. Most issuers require notification within a specific time (often 30 days of the statement). Delayed reporting may affect the review.
Unwanted Recurring Charges
Recurring charges from a subscription service that was cancelled, or charges from a merchant who refuses to honour a cancellation, are handled differently from fraudulent charges. The consumer typically must attempt to cancel with the merchant first and provide proof of the cancellation.
Where the merchant continues to bill after valid cancellation, the consumer may request a chargeback under the network rules or CPA s. 99 (if applicable in Ontario). The cardholder may also place a 'stop payment' instruction on future charges from that merchant.
Steps to Take
The first step is to contact the card issuer through the dedicated fraud or dispute line. The issuer may immediately reverse fraudulent charges, replace the card, and open an investigation. For disputed (not fraudulent) charges, the issuer opens a chargeback case.
Supporting documentation for a non-fraud dispute typically includes the cancellation notice, correspondence with the merchant, and any receipts. For fraud, no merchant correspondence is needed.