Imagine that your girlfriend gave you her credit card to pick up dinner from your favorite Memphis restaurant. The cashier rings up your order, runs the card and prints out the receipt for you to sign. Thinking nothing of it, you sign the receipt, collect your food and head home for a nice quiet dinner. What you may not know is that you just committed credit card fraud.
Most people think of credit card fraud are someone stealing your information and making purchases three states away, or in a whole other country. In reality, credit card fraud comes in many different forms and you could be committing it without even realizing it. It may surprise you to know how you, inadvertently, might be committing credit fraud.
Inflating your income on the application
When you first apply for a credit card, you have to provide certain information. For example, you have to list your name, address and social security number. You also have to provide you annual income. Some people think that by overstating their income they can get a higher credit limit and that doing so is not an issue. Everyone does it, right? Actually, by purposefully misstating any information on a credit card application, you are committing credit card fraud. Even lying about your age can land you with some serious fines, probation or a trip to lock up.
Disputing legitimate charges
If you regularly use your credit card, there could be a long list of charges on your statement at the end of each month. Sometimes it is easy to forget about a charge here or there and not recognize the purchases on your statement. Your first instinct might be to call the credit card company and dispute the charge, claiming it is fraudulent. While some people accidently dispute legitimate charges from time to time, this actually falls under the category of "friendly fraud."
Using someone else's card without consent
Simply because your mother let you use her card to make an online purchase last month does not mean that you have permission to use it again in the future. If you use someone else's credit card without his or her permission, you are engaging in fraud.
Signing for someone else
As mentioned in the opening example, if you sign someone else's credit receipt, even with permission, you are committing fraud. The reason for this is that the receipt is the seller's and the credit card company's way of verifying identity and giving legitimacy to the purchase. Imagine that a week after you purchased dinner for you and your girlfriend with her credit card, the two of you break up. When her credit card statement comes, she might decide to dispute that charge at the restaurant that you signed for. Since it is your signature on her credit card receipt, you could end up facing charges for credit card fraud.
Using a fake number
Many subscription companies offer free trials but they also require a credit card number to begin the trial. You do not want to be bothered with canceling the service after the free trial is over, so you use a fake credit card number when you set it up. It's free, so no big deal, right? Unfortunately, if you use a fake card number, even for a free trial offer, you are committing fraud.
Credit card fraud charges can come with some serious penalties. If the court convicts you, you may have to pay expensive fines, serve probation or even spend time in jail. If you are facing charges for credit card fraud, it is important to remember that you still have rights and options.