What’s the punishment for credit card fraud?

Credit card fraud is a broad term that covers any crime involving a payment card. Usually, the goal of credit card fraud is to get access to someone else’s funds, but it can sometimes involve identity theft as well.

Credit card fraud punishment

Credit card fraud can mean a range of things, but in essence it’s stealing someone’s credit card to access their funds and/or identity. But even if no funds are taken, stealing a physical credit card or the card’s information is punishable by law.

And if the card is actually used, the punishment for fraud is more severe. The highest form of credit card fraud peaks with credit card forgery and identity theft.

Different states have different laws in prosecuting and classifying credit card fraud. Depending on these factors, credit card fraud can be a:

• Minor offense. The punishment for a minor offense is typically a monetary fine, rarely jail time. Typically, minor offense includes stealing the card but not using it.
• Misdemeanor. The punishment can be a combination of a higher monetary fine and jail time. In most cases, misdemeanor is when the fraudster uses a relatively small amount from the stolen credit card.
• Felony. This is the most serious crime that often comes with the highest monetary fine and years in prison. This includes a higher credit card spend, credit card forgery and identity theft.

What are the chances of getting caught using a stolen credit card?

Unlike paying with cash, credit card purchases are easily traceable because they leave a digital footprint. To avoid that, fraudsters use freight forwarders or shipping mules to disguise their address if ordering online. Another frequently used method is called triangulation.

Triangulation is a process where the fraudster opens up multiple eBay accounts and sells legitimate items they don’t actually possess. When person A buys the item and deposits the money to the fraudster’s PayPal account, the fraudster orders the same item from another seller using the stolen credit card and has it shipped to the person A’s address. This way the fraudster gets off with the money while person A receives an item bought with a stolen credit card.

These methods only lower the chances of getting caught, but they can still be tracked.

Do police investigate credit card theft?

Calling the police and filing a report is among the first things you should do when you discover credit card theft. This can result in a police investigation, but only if it’s a serious crime. Sometimes, the police may not get involved and claim that this is an issue you should resolve with your credit card company.

Compare credit cards with fraud protection

Some credit cards come with a variety of fraud protection features, such as the option to freeze and unfreeze your card, chip-and-pin protection that increases counterfeit difficulty or zero liability for unauthorized purchases.

Bottom line

Credit card fraud is punishable by law. Even if you steal the card and never use it, you can still be on the hook and pay a fine. But the severity of the punishment depends on the state where it’s committed.

To protect yourself against credit card fraud, be sure to compare credit cards with fraud protection.

Frequently asked questions

• Does credit card fraud also include debit cards?

  Yes, unauthorized use of someone else’s debit card is also considered credit card fraud.

• If I use someone else's card by mistake, is it considered credit card fraud?

  In most cases, no. Using someone else’s card unintentionally, may not hold you liable for credit card fraud. To be held liable, there has to be an intent to commit fraud in order to be found guilty.