Bank Fraud: What to Do When Money Leaves Your Account

Someone took money from your checking account without asking. Here is what bank fraud is and what to do first.

You open your banking app and see a withdrawal you never made. Or a charge from a store you have never heard of. That sinking feeling is real, but the next steps are simple.

What bank fraud is, in everyday terms

Bank fraud, in your case, means someone took money out of your checking account without your approval. The CFPB says you can find out how to get your money back if someone took funds out of your checking account without approval. The key word is "without approval."

First steps: report it to your bank

Report the fraud to your bank or credit union as soon as you can. Regulation E says a consumer may notify the institution in person, by telephone, or in writing.

You do not need a perfect report to start. Regulation E says notice counts as given when you take reasonable steps to give the institution the needed account information. You can identify the account by the name on it and the type of account.

Sometimes the bank learns of the problem on its own. Regulation E says notice may be considered constructively given when the institution becomes aware of circumstances suggesting an unauthorized transfer may have been made.

What the rules say about unauthorized transfers

The notice rules above come from Regulation E, the federal rule on unauthorized electronic transfers.

One part of the rule matters here. Regulation E says that if an unauthorized transfer involved an access device, it must be an accepted access device. The bank must have provided a way to identify you as the person the device was issued to. The rule's interpretation says a bank may use a PIN to identify you. Or it may compare your signature, fingerprint, or photograph.

What if you could not report it right away?

Life gets in the way. Regulation E says a financial institution must extend its notice deadlines for a reasonable period when a consumer's delay was due to extenuating circumstances. A long trip or a stay in the hospital are two examples.

Can someone else report it for you?

Yes. Regulation E's interpretation says notice given by a person acting on the consumer's behalf is valid. The bank may ask for paperwork first. The interpretation says a financial institution may require documentation showing that a person is acting on the consumer's behalf. A family member helping a parent may be asked for that proof.

Reporting a lost or stolen debit card

Is your debit card gone? The FTC says to report it to the bank or credit union that issued it as soon as possible.

The FTC says federal law does not make you pay for charges or withdrawals made without your permission. This applies after you report the loss. What you might owe on an ATM or debit card after someone uses it depends on how quickly you reported it. The FTC says you are not responsible for unauthorized ATM or debit card transactions. This applies if you report the loss before someone uses it.

Debit card transactions take money from your account right away, the FTC says. For more, read about debit card fraud.

The FTC also suggests checking whether your homeowner's or renter's insurance covers you for card thefts.

If it is more than one account: identity theft

Sometimes the problem is bigger than one account. Someone may have opened new accounts in your name, not just taken money from yours. That is identity theft.

The FTC says to check your free credit reports for accounts or charges you do not recognize.

If you find signs of identity theft, the FTC says to visit IdentityTheft.gov. You can report it there and get a recovery plan.

How to keep watching your accounts afterward

Reporting once is not the end. The FTC says to keep checking your account statements and report fraudulent charges right away.

The FTC advises two habits. Use multi-factor authentication on your accounts when it is available. And check ATM or debit card transactions carefully. They take money from your account right away.

For more ways to lock things down, see prevent credit card fraud.

Bank fraud is a broad label. These pages break down the specific kinds.

Debit card fraud covers stolen card numbers and unauthorized withdrawals.
Credit card fraud covers charges on a credit card you never made. The FTC says you are not responsible for unauthorized charges on a credit card if you report the loss before someone uses it. If you report the loss after someone uses it, the most you might owe is $50.
Check fraud covers altered, forged, or copied checks.

If money left your checking account without your permission, you now know the word for it and the first report to make. Report it to your bank, keep watching your statements, and check your credit reports for anything else the thief may have done.