Understanding what credit card fraud can look like
Credit card fraud doesn’t just involve mysterious charges from overseas or charges for seemingly endless electronics; it takes many forms and can happen accidentally. Just signing a credit card slip for someone, even with their permission, can lead to trouble. How might this play out for college students? Envision the closing time scramble at college bars when (likely) everyone has had too much to drink, and the tab needs to be paid. The following conversation ensues:
“I don’t have enough cash. Can you pay? I’ll Venmo you.”
“I can’t use my card; my parents will kill me!”
“The Uber will be here in two minutes; we need to figure this out…”
Finally, someone, perhaps underage, offers a card and another friend, perhaps of-age, heads off to the bar to close the tab. As credit card fraud continues to rise, merchants and banks are taking more precautions than ever to flag fraudulent transactions, so it’s important that students understand what credit card fraud can look like.
1. Signing a slip for someone else
In the state of Ohio, this closing-time scenario could lead to criminal charges for Forgery and Misuse of a Credit Card, both felony offenses. Not to mention, possible identity theft issues if the person who paid had a fake ID. Students should understand that giving anyone their credit card or accepting a credit card from someone creates risk that should be avoided, plain and simple. Note for parents: if you give your student a credit card, have the child’s name put on the card under a parent account. Don’t just give your child a card with your own name on it.
2. Disputing valid charges
Sometimes, we forget about a purchase and dispute the charge. While there’s nothing wrong with disputing improper charges, disputing valid charges is a recipe for disaster. Before disputing a charge you don’t recognize, be sure to review personal receipts and records. Also, keep in mind that sometimes merchants’ names appear different on a credit card statement, so conduct an internet search on the merchant’s name before disputing a charge. Finally, keep in mind that disputing a valid charge isn’t a way to resolve a dispute with a merchant when you’re dissatisfied with a purchase.
3. Exaggerating on credit card applications
College students are inundated with credit card offers that often include free gifts and zero percent interest for a fixed term. With “free money” staring them in the face, college students sometimes succumb to temptation and overstate their income or lie about employment status on the mistaken belief that it doesn’t matter. Don’t do it! False information on a credit card application is credit card fraud.
4. Using a card without permission
Using someone else’s credit card without permission clearly constitutes credit card fraud. However, it bears repeating, particularly because college students are sometimes unclear about what “permission” actually looks like. Before making a charge, expressly ask for permission. Just because a friend or roommate agreed to a charge in the past doesn’t mean that you can continue to use the card. Before using someone else’s card, it’s smart to have a text message or some other written communication confirming permission.
What if you are a victim of credit card theft or fraud?
If your credit card is lost or stolen, call the credit card issuer right away to report the card as missing. If your card wasn’t stolen, but you notice unauthorized charges, be sure to change your account log-in information: username, password, and PIN. As a precaution, it’s always a good idea to sign up for notifications for all charges. Also, review your credit card statement closely every month and report unauthorized charges. Under the Fair Credit Billing Act, you are likely only responsible for $50 of fraudulent charges. Finally, monitor your credit through credit reporting agencies such as Experian, Equifax and TransUnion.
If you have any questions about this article or would like to learn more about fraudulent credit card use on college campuses, contact Kristina Supler (kws@kjk.com; 216.736.7217) or Susan Stone (scs@kjk.com; 216.736.7220).