Credit card fraud is the “deceptive or unauthorized use of another person’s credit card account in an attempt to steal money, goods, or services.” Credit card fraud and identity theft laws are enforced by local police departments and the federal government, typically through the Secret Service.
Credit card theft (and debit card theft) encompasses many forms and is relatively common. The severity of the punishment depends on several factors, beginning with how the state views the case and whether the federal government becomes involved.
Types of Credit Card Theft and Fraud
Credit card fraud can occur whether or not the card is present and includes:
- Using a stolen credit card before it’s reported missing
- Tricking the account holder into divulging their credit card information via phone or through, email or on the web (phishing), then using it for unauthorized purchases
- Stealing the information through a data breach at a retailer, agency, credit bureau, or other entity
- Using a bank or credit card statement found in the trash
- Possessing devices or equipment to steal credit card information, such as skimmers attached to card readers
- Using, producing, or transferring counterfeit access devices such as skimmers
- Knowingly using a credit card that is expired, revoked, or lacking funds to cover the transaction
- Selling anything to someone when you know the credit card was illegally obtained or used without authorization
Committing credit card fraud means you did one or more of the following:
- Fraudulently obtained, took, signed, used, sold, bought, or forged another individual’s credit card or information
- Used your own card knowing it was revoked or expired or that the account didn’t have money in it to pay for the items
- Sold goods or services to an individual knowing the credit card was illegally obtained or used without authorization
How Common Is Credit Card Fraud?
At least 79% of consumers own at least one credit card, meaning nearly 203 million credit card holders exist in the US.
According to the Federal Trade Commission (FTC), credit card fraud was the most commonly reported type of identity theft from 2017 to the present. The only time it dipped was during the pandemic between 2020 and 2021, which was beat out by fraudulent claims for unemployment benefits and other relief programs.
That includes only the cases reported to the FTC; many never reach the agency because the card issuer handles them. Based on data from the Census Bureau and the Federal Reserve, an average of 9.5 million consumers experiences an incident of credit card theft annually. In 2020, 3.5% of cardholders reported a credit card loss, theft, or fraud in the previous 12 months.
In 2021, a survey by researchers at Security.org showed that 58% of respondents experienced credit card fraud at some time in their life. Nearly 10% were victimized four or more times.
Punishment for Credit Card Fraud
The state or federal government must prove intent to defraud or steal to convict someone of credit card fraud.
Most credit card fraud cases are handled at the state and local levels. The severity of the punishment often depends on the individual’s criminal history, the amount stolen, whether the victim was elderly, and whether the individual had criminal intent. Accidental misuse of the credit card information is not a crime.
In Texas, credit card fraud is a state jail felony that gets you up to two years in jail and up to $10,000 in fines. If you commit fraud against an elderly person, the prison sentence can go up to 10 years.
If the fraud affects interstate or foreign commerce, the feds enter into it. Committing federal fraud isn’t difficult — just make an online purchase with someone else’s credit card. If the card was issued to someone in another state or the purchase was from a business outside the state, you can be charged with interstate fraud.
Suppose you use a device, like a skimmer, to commit fraud. In that case, the federal government can sentence you up to 15 years for the first offense and up to 20 years for the second and subsequent offense. It may also charge fines and require you to forfeit your personal assets.
Fraudulent credit card use also includes the following federal crimes:
- Computer fraud
- Mail fraud
- Wire fraud
- Financial institution fraud
The penalty can be up to 30 years in prison.
Why Do You Need an Attorney If You Are Charged with Credit Card Fraud?
Credit card fraud carries harsh penalties, and any felony conviction can limit you for the rest of your life. You might have problems finding a job or a place to live. You might be barred from owning a firearm. Banks might deny you loans or charge high interest rates if you have a felony conviction on your record.
Credit card fraud is a high-profile crime because of its ubiquity. Sometimes prosecutors want to make an example of you because the public is so hostile toward credit card thieves.
An attorney can reason with the judge and present your circumstances in a way to sway the judge toward leniency. They can show you have sorrow for your past conduct and have committed to a crime-free life.
Your lawyer also performs the following services if you choose to go to trial:
- Reviewing all of the state’s evidence for discrepancies
- Conducting an independent investigation
- Developing a trial strategy
- Convincingly presenting your case to a jury
It’s unlikely you can perform these services for yourself. A felony-level crime is not the time to represent yourself.
If you are accused of credit card fraud, you need an attorney who understands Texas credit card fraud law. You need a lawyer who can present your case to your advantage and defend you in state and federal court.
At the Office of Brett Podolsky, we represent you throughout the criminal justice process, advise you of your options and possible outcomes, and protect your rights.