Can a credit card company garnish your money from your bank account with out your knowledge?

Answer 1

Strictly speaking, a 'garnishment' refers to the direct deduction of an individual's wages directly from their pay, through an arrangement with their employer and pursuant to a court order. So, it would be pay that is 'garnished.'

Access to a bank account may be far less difficult to obtain. A credit card company may have included clauses in their cardholder agreement by which the cardholder (ie, you) consented in writing to the direct collection of funds from a bank account; this would usually either be a specific 'automatic payment' option which the account holder elected (ie, to make the payment on a specific date each month), or by a default agreement written into the contract. In either case, the cardholder's failure to read the fine print would be to blame for such a debit.

So, although this might literally be 'without the cardholder's knowledge,' it would technically be 'with the cardholder's knowledge,' since this is precisely what the account holder agreed to (or even requested), in writing.

If this is no longer desireable, the credit card company should be notified in writing that such authorization is revoked. One's bank may or may not refund the charges. If such authorization is not considered revokable (according to the credit card company's terms of service), then they may continue such debits. Banks are usually reluctant to refund direct account debits, although many do. The ultimate solution is to close the bank account and open another.

For this reason, many companies prefer automatic check debits, as opposed to credit or debit transactions drawn on bank accounts; It is very easy to delete and reissue a debit (credit) card drawn on a bank account. It is more difficult to close and re-open a bank account, and a consumer is likely to have pending checks that must clear before the account can be closed, and at least a small cost to replace checks drawn on the (now) non-existent account. That makes it easier to get away with the debits; it may be easier and less costly for a customer to just allow the debits.

Consumers should never provide their bank account numbers to anyone, for any reason. Payments should be made via debit card number. That way, individual charges can be contested or reversed without the hassle of closing and re-opening accounts. Debit cards can even be re-issued with new numbers without changing the source account numbers.

Now, all of that notwithstanding, if a debit is indeed 'without authorization,' then this would be wire fraud, and should be reported to law enforcement.