Could I Face Federal Charges for Using Someone Else’s Credit Card?

 Posted on December 13, 2024 in Fraud

In today’s digitally connected world, we tend to use credit and debit cards to pay for just about everything. Most of us do not think twice before pulling out a card to pay for nearly any size purchase or typing in our card info to buy something online.

But what could happen if you use someone else’s card to make a purchase or pay a bill – especially if you knowingly do it without that person’s permission? The answer depends on many different variables, but you could potentially face federal charges for credit card fraud. Contact our Illinois federal criminal defense attorney if you are facing this serious charge.

Credit Card Verification Procedures Are Dated, Making Fraud Easier

When customer-facing credit card processing pads were first installed at retail establishments, cashiers were generally trained to verify that the person swiping the card was, in fact, authorized to do so. In practice, this process was little more than a cursory glance to compare the customer’s signature to the signature on the back of the card, but some cashiers would ask for identification from the customer. Some customers might not have been thrilled with the minor delay, but the purpose of the verification was to prevent fraud.

Today, however, cashiers rarely check signatures, and with the rise of PIN-protected debit transactions, retailers are largely staying away from determining whether or not a customer is authorized to use a particular card. Online retailers, by comparison, might ask for a billing address or other identifying details, but they still have no way to know who is actually making the purchase in most cases.

Authorized vs. Unauthorized Card Use

The changing practices of both brick-and-mortar and online retailers are relevant because the most important variable related to the possibility of being prosecuted for credit card fraud is whether you were authorized to use a card belonging to someone else.

In most cases, verbal authorization is sufficient to make your use of the card legal. For example, if your friend hands you his card and asks you to buy something for him at the store, he has effectively authorized your use of the card. This also applies if your friend provides his card information for you to make an online purchase on his behalf.

If you use someone else’s card without permission, however, your behavior constitutes unauthorized use. This includes taking a physical card without permission or saving the card information to an online retail account, and knowingly making future purchases without your friend’s approval.

Could I Be Charged for Using My Boyfriend’s Credit Card? 

If a man and a woman are seeing each other and the man gives the woman his credit card to order lunch for them both, she could legally use the card to do so. But if she later took the credit card and spent money online, that would be unauthorized use and would be against the law. If the man was upset about it, he could potentially report it to his bank and press charges against the woman.

However, cases like that are not typically prosecuted aggressively. Rather, the most serious kinds of credit card fraud involve organized theft of credit card information and multiple transactions resulting in massive financial loss to one or more people.

Examples of Federal Credit Card Fraud

Prosecutors typically use federal credit card fraud charges when offenses involve interstate activity, substantial financial loss, or organized schemes. Here are the most common reasons for federal prosecution:

• Interstate or International Transactions: Using stolen credit card information across state or international borders often triggers federal jurisdiction.

• Large-Scale or Organized Fraud: Data breaches, criminal rings, or schemes impacting numerous victims are more likely to attract federal attention.

• Cybercrime: Hacking, phishing, and other digital methods to steal or misuse card information often involve federal laws, such as the Computer Fraud and Abuse Act.

• Use of Postal Service or Interstate Communication: Fraud involving mailed counterfeit cards or scams conducted via phone or email may lead to federal charges.

• Federally Insured Institutions: Fraud impacting banks or credit unions insured by federal agencies often falls under federal jurisdiction.

• High Financial Thresholds: Significant financial losses, such as fraudulent transactions exceeding $50,000, are often prosecuted federally.

Federal credit card fraud penalties include up to 10 years in prison, hefty fines, and additional penalties for related crimes like identity theft.

High-Profile Credit Card Fraud Cases

In one high-profile example of federal credit card fraud, a man named Albert Gonzalez orchestrated the theft of over 40 million credit and debit card numbers between 2005 and 2007. Gonzalez and his team of hackers exploited vulnerabilities in the payment systems of major retailers, using techniques like "wardriving" (searching for vulnerable wireless networks) and deploying "sniffer" programs to intercept credit card data.

Gonzalez accessed sensitive payment information. He then sold the stolen card numbers on the dark web, earning millions of dollars in profits. Gonzalez was sentenced to 20 years in federal prison, one of the harshest penalties for cybercrime at the time.

What are the Penalties for Credit Card Fraud? 

At the state level, Illinois penalizes credit card fraud depending on the severity of the offense. If the amount of the purchases on the card was less than $300 within a six-month period, the charge is usually a Class 4 felony. If the amount of the purchases exceeds $300, the charges can be a Class 3 felony with up to five years in prison and fines up to $25,000. However, credit card fraud charges are rarely used alone; they often go hand-in-hand with other serious crimes like identity theft.

Likewise, at the federal level, credit card fraud penalties vary widely depending on the amount of the purchases and whether the credit card fraud involved other commonly associated factors like identity theft. In 2022, the average amount of financial loss from credit card fraud was over $111,000, and the average sentence was 26 months. Over 90 percent of offenders received prison time. Having an attorney represent you gives you the best chance of reducing the charges and the resulting sentences.

Call a Chicago, IL Credit Card Fraud Defense Lawyer

If you are facing charges related to the unauthorized use of a credit card, an experienced Chicago, IL white-collar criminal defense attorney can help you protect yourself and your rights. Call 312-629-0669 for a free consultation at Law Offices of Hal M. Garfinkel LLC, Chicago Criminal Defense Attorney today. We will do everything we can to assist you in obtaining the best possible outcome for your situation.