Can Someone Else Use My Credit Card?

Whether another person can use your credit card depends on permission. Understanding the distinctions between authorized use, where the primary cardholder is fully responsible, and unauthorized, fraudulent use is important. This article explores the implications of allowing someone else to use your credit card, outlining liabilities and protective measures.

Permitted Use and Cardholder Liability

Allowing another individual to use your credit card falls into specific categories, each with distinct implications for the primary cardholder’s financial responsibility. One common method is to add someone as an authorized user. This involves contacting your credit card issuer, providing their details, and results in them receiving a separate card linked to your primary account.

When you add an authorized user, they can make purchases. The primary cardholder remains responsible for all charges made by an authorized user. Their spending contributes to the primary account’s credit limit and payment history, impacting the primary cardholder’s credit score depending on how the account is managed.

Another scenario involves lending your physical credit card for a one-time purchase or series of transactions. This does not absolve the primary cardholder of liability for any charges incurred. Credit card agreements state that only the primary cardholder and authorized users are permitted to use the card. If you lend your card and they make unauthorized purchases or misuse it, you are still financially responsible.

Any form of permitted use, whether through authorized user status or informally lending the card, places financial burden and liability on the primary cardholder. If the authorized user or person lent the card fails to pay, the primary cardholder must cover the debt. This highlights the importance of carefully considering who uses your credit card and establishing clear repayment agreements.

Fraudulent Use and Reporting

Credit card fraud occurs when a card is used by someone without the primary cardholder’s permission. This can range from a stolen physical card to compromised account details obtained through data breaches, phishing scams, or identity theft. Unauthorized charges appearing on a statement, despite the card remaining in the cardholder’s possession, also constitute fraudulent use.

Upon discovering unauthorized charges or a lost/stolen credit card, immediate action minimizes financial loss. Contact your credit card issuer without delay. Many issuers offer 24/7 customer service and allow card freezing or blocking through mobile apps or online portals. Swift reporting is important for determining your liability for fraudulent transactions.

Federal law provides protections for consumers against unauthorized credit card use through the Fair Credit Billing Act (FCBA). Under the FCBA, liability for unauthorized charges is limited to $50 if reported promptly. If you report unauthorized use before charges are made, or if your account number is used without your physical card, liability is $0. This protection depends on timely notification, within two business days of discovery.

The FCBA distinguishes between permitted use, where the cardholder is fully liable, and documented fraudulent use. This legal framework protects consumers from the financial burden of theft, but emphasizes the cardholder’s responsibility to monitor accounts and report suspicious activity promptly.

Safeguarding Your Credit Card Information

Protecting your credit card details involves physical security and digital vigilance. Keep physical credit cards secure by storing them in a safe place, like a wallet or purse, and never leaving them unattended in public. Periodically check that all your cards are accounted for.

When making online transactions, exercise caution to protect your financial information. Ensure websites are secure by looking for “https://” and a padlock icon before entering payment details. Using strong, unique passwords for online accounts helps prevent unauthorized access. Many websites also offer multi-factor authentication.

Being aware of common scams, such as phishing attempts, is important. Phishing emails or text messages try to trick you into revealing sensitive information by impersonating legitimate organizations. Never click suspicious links or provide credit card details in response to unsolicited requests. Legitimate companies rarely ask for your full credit card number, PIN, or security code via email or text message.

Regularly monitoring credit card statements for unusual or unrecognized transactions helps detect fraud early. Many credit card issuers provide alerts for transactions above a certain amount or for purchases in unusual locations. Shredding old credit card statements, receipts, and documents containing account information before discarding them prevents identity thieves from accessing your data.

https://www.consumerfinance.gov/consumer-tools/credit-cards/credit-card-fraud/
https://www.consumer.ftc.gov/articles/what-do-if-your-credit-card-stolen
https://www.consumerfinance.gov/ask-cfpb/what-is-the-difference-between-a-credit-card-and-a-debit-card-en-1052/