What is the most common reason for a fraudulent dispute?

• A. The customer reports a defective product.
• B. The merchant used an invalid billing descriptor.
• C. The cardholder denies ever making the purchase.
• D. The cardholder claims they didn't authorize the payment.

Answer: (D)

Fraudulent disputes center on the cardholder claiming they did not authorize the charge. This is the most common way a dispute is classified as fraudulent: the cardholder says someone else used their card or that they don’t recognize or remember making the payment. Because unauthorized usage is the defining feature of fraud, this scenario appears far more often as the reason for a fraud-related dispute than other issues like receiving a defective product, problems with the billing descriptor, or simply saying they don’t recognize the purchase for reasons other than lack of authorization. In practice, merchants must provide evidence that the transaction was authorized to contest these disputes, but the core reason itself is the assertion of non-authorization.