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Help! I've Been Ripped Off!

I recently tried to resolve a dispute with DirecTV, the satellite television provider owned by Hughes Electronics (NYSE: GMH  ) . DirecTV claimed I should pay almost $200 for the past few months' worth of programming I had been receiving.

I had just one complaint: I didn't have a dish. And without a dish, there was no way I could receive any programming.

Regardless, the supervisor with whom I spoke (a fellow named Carlos) said that their records indicated that I indeed had a dish installed and that I was expected to pay the bill.

The implication was clear: Pay up or your credit score will go down.

I was furious. I also felt helpless. What was to prevent DirecTV from tainting my credit history? The next time I attempt to borrow money, if there's a black mark on my record, who is the lender going to believe: the little fish or the Big Dish?

Given the power that a credit score has over our lives -- determining rates on mortgages, auto loans, and even insurance policies -- this is a serious concern. (This is also why we recommend that you check your credit record annually with all three major agencies, which can be done through our partnership with TrueCredit.)

So what is a consumer to do when charged for a service or product that wasn't received? Or what if the product was defective or the service unsatisfactory, yet the provider demands full price? Here are some of the most common ways to resolve a dispute, save your credit record, and be a pain in someone's behind.

Take it up the ladder -- or at least go sideways
The first step is to talk to someone else at the company. It doesn't necessarily have to be a higher-up, just another person to hear your case (though it should be someone who has the power to resolve your dispute). Call at a different time on a different day, and ask for a supervisor or manager.

This is where all those years of paying your bills on time might pay off. If you have a solid credit score, a company should be reluctant to lose a current or potential customer. Also, a company shouldn't want to risk you passing along your horror story to your network of friends, associates, lackeys, and goon squads.

This simple strategy resolved my problem with DirecTV. My conversation with Carlos the supervisor took place on a Saturday afternoon, so I called again the following Monday morning.

Sure enough, another supervisor, named Aldo, realized I shouldn't pay for a service I wasn't receiving. He wiped away the erroneous charges, and I have since had a dish installed and subscribed to the NFL Sunday Ticket. Thanks to Aldo, DirecTV has a happy customer (and his money), and I can watch my beloved Tampa Bay Buccaneers from my home in Virginia.

However, not every dispute can be resolved by a phone call. Sometimes, a letter to people in authority at the business is the better choice. Explain the situation, starting with your biggest complaints, and request a response within 10 business days.

If this doesn't work, document everything you've done so far -- times you called, to whom you spoke, what you discussed, copies of correspondences, etc. -- and get ready to rumble.

Wield your credit card
If you paid for your item or service with a credit card, dispute the charge. Put your request in writing within 60 days of when the credit card bill with the questionable charge was sent to you. You can withhold payment of the disputed amount when you pay your credit card bill (but you still have to pay for your other charges). If you've already paid the bill with the disputed item, the credit card company may issue you a temporary credit. The person with the money has the most leverage, so if the issuer will credit your account, you've gained some power.

The credit card company then contacts the merchant and decides who should get the money. If the issuer sides with you, you will not have to pay for the disputed charge or associated financing charges. Otherwise, you're responsible for payment -- and you'll have to take your fight to another battleground.

Sic the government on 'em
Most levels of government have some form of consumer affairs department. Start local by seeing what protections your city or county offer. In most cases, these government agencies can't force a merchant to acquiesce, but they might investigate the complaint and contact the business. Your local government might also offer voluntary mediation and arbitration services. Plus, they keep track of complaints and will investigate a company that has too many unhappy customers.

States also have consumer protection departments, and there's always the Federal Trade Commission. If laws were broken, the appropriate authorities might take action. You'll also get some solid advice from the staff and websites of consumer protection agencies. Plus, the merchant may be more willing to resolve the dispute than to have complaints filed against it on the local, state, and federal levels.

Sic the courts on 'em
If the consumer protection services of the government can't help you, perhaps the legal system can. You could take the merchant to court. This is a complicated issue since rules and regulations vary across the country, so contact your local court system and learn about your options.

Litigation can be expensive and time-consuming, so it's not to be entered into lightly. However, the threat of litigation could persuade the merchant to settle your complaint. If you have cheap access to a lawyer (e.g., you're part of a pre-paid legal service or married to an attorney), a letter written on your behalf might be enough. And, if eligible, you could also file a small-claims action, which doesn't require the services of a lawyer.

If the disputed charge is in the thousands of dollars, then hiring an attorney might be worthwhile, though the associated fees will take a huge bite out of any settlement you might receive.

Know when to fold 'em
At some point, you might have to check your ego and determine when it's time to just accept the loss. There will come a point when the aggravation, time, and other costs aren't worth it. Complain to everyone possible, then move on.

Whatever you do, make your voice heard. Besides notifying the appropriate government agencies, warn other consumers by telling your tale of woe on the Internet. Many websites allow users to rate a merchant's service or products, whereas others provide a forum for disgruntled customers. Jump on your cyber-soapbox at such sites as Epinions.com, TheSqueakyWheel.com, AngiesList.com, BadDealings.com, FightBack.com, and even the Better Business Bureau at BBB.com.

You can also air a company's dirty laundry on our News & Commentary discussion board. Post (or email) a story of how you've been ripped off, and -- if resolved -- how you persuaded a merchant to see things your way. And for help in righting the wrongs on your credit report, visit our Credit Center.

Now that Robert Brokamp has settled his dispute with DirecTV, he has to figure out how to get money back from an eBay (Nasdaq: EBAY  ) seller who didn't deliver the goods. Any advice? Brokamp is the co-author ofThe Motley Fool Personal Finance Workbookand author ofThe Motley Fool's Guide to Paying for School.


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