I was awakened by pipe banging that sounded like a jackhammer going off. No water was running at the time. It has happened again once or twice already today. My kids are terrified. The water company says it's my problem.

What should I do?

Check the toilet cistern. I would bet the flapper is leaking. The ballcock eventually wants to refill the tank, the sounds is water hammer as it atempts to shut off.

You can check for the leak by putting food coloring in the cistern when you go to bed, if there is any color in the bowl, bingo.

Let us know if this helps.

I thought the title of what you wrote meant something else...