Attorney General Kwame Raoul encouraged Illinois residents on April 30 to be aware of their rights when setting up automatic payments for recurring expenses such as gym memberships, utility bills, subscriptions, student loans, car payments, and rent or mortgage.
The reminder is intended to help consumers avoid problems that can arise from autopay arrangements. These issues may include charges being processed after cancellation, changes in payment amounts without notice, or unexpected payment dates. Raoul said that understanding these rights can protect consumers from financial difficulties and unauthorized withdrawals.
“While many consumers enjoy the ease of paying for recurring fees and memberships through autopay, it is important they have information on their rights and options when issues do arise,” Raoul said. “I encourage all Illinoisans to use the information contained in this Consumer Alert and never hesitate to contact my office’s Consumer Fraud Bureau with any questions or concerns.”
Raoul outlined several recommendations for consumers before authorizing automatic payments. He advised verifying the legitimacy of companies before sharing banking details and reading terms of agreement carefully. Consumers should keep a copy of any authorization provided. Written or electronic authorization is required before a company can collect money via autopay, and companies must provide a copy upon request.
Consumers are able to revoke authorization at any time by notifying either the company or their bank at least three business days before a scheduled payment. While phone cancellations are allowed, written notices are recommended for recordkeeping purposes. Additionally, companies cannot require loan repayments solely through autopay unless it involves an overdraft line of credit; manual payments must be allowed otherwise.
If there are changes in the amount due under an automatic payment plan, companies must notify customers at least ten days prior to the scheduled transaction date with details about the new amount and transfer date. Regular monitoring of account balances is also suggested since insufficient funds could result in fees.
According to the official website, the Illinois Attorney General has advocated for vulnerable groups including workers, immigrants and seniors; handled thousands of consumer complaints each year; aimed to protect consumers while promoting safer communities; extended advocacy efforts across Illinois; partnered with law enforcement agencies; and offered services such as complaint filing related to consumer fraud and civil rights.
Raoul urged anyone who suspects unauthorized withdrawals or unresolved issues after canceling autopayments to contact their bank immediately—and follow up in writing—as timely disputes may allow them to recover lost funds. Complaints against banks or companies violating these protections can also be filed with federal agencies like the Federal Deposit Insurance Corporation (FDIC), Federal Trade Commission (FTC), Consumer Financial Protection Bureau (CFPB), or directly through his office’s website.
