What's a little credit card fraud among friends?
November 8, 2005 2:19 PM   Subscribe

What's a little credit card fraud among friends?

OK, friend A and friend B are hanging out. friend A has a horrible addiction to drugs and alcohol and is trying to stay sober. Friend B knows nothing about this and is therefore not concerned about friend A's drinking that night. Friend A is in the midst of a horrible relapse and resorts to stealing friend B's wallet, spending ~$100 in cash and ~$300 on various credit cards. Friend B wakes up the next day, notices his wallet missing and suspects friend A but can't get to the bottom of the story. The credit card companies suspect fraud, all the cards are reported stolen and canceled. Two days later friend A owns up to his misdeeds and is, for the most part, forgiven. Friend B wants to keep the authorities out of this mess but is unsure how said authorities will respond to the situation. What should friend B do to this end, i.e. how should he explain the situation to those investigating these sorts of things?
posted by garethspor to Law & Government (32 answers total)
 
Did friend A pay back the debt?
posted by ThePinkSuperhero at 2:22 PM on November 8, 2005 [1 favorite]


Yeah. Friend A will have to let the credit card companies know that it wasn't fraud and will have to pay for the charges.

It is as simple is just telling them that you didn't realize your friend borrowed the cards. The banks just want their money and don't care about the backstory.
posted by birdherder at 2:24 PM on November 8, 2005


[and by "you" I meant "Friend A"]
posted by birdherder at 2:25 PM on November 8, 2005


Response by poster: friend A will definitely be responsible for the debt, and will be returning the physical wallet. good question
posted by garethspor at 2:25 PM on November 8, 2005


Friend B should tell the truth. He may not want to press charges, but he shouldn't lie about the situation, especially not to agents of the law.
posted by alms at 2:26 PM on November 8, 2005


Lying to the authorities about the situation will do nothing but make things alot worse. Come clean and then get your friend into rehab before he does this to someone who isn't as understanding.
posted by fenriq at 2:33 PM on November 8, 2005


Response by poster: for the record, neither of these characters are me, I'm just a mutual friend, and acting as a bit of an intermediary.
posted by garethspor at 2:34 PM on November 8, 2005


Friend B can tell the card companies that he accepts the charges after all, and takes responsibility for them. He "forgot" friend A had permission to use the card. Neither law enforcement nor the credit card companies really care about $300, and if they get their money, B's ethical obligations are satisified. Obviously A, should be the one paying those charges and the wallet cash back.

That's what B CAN do. What B should do, IMHO, is drop A like a hot potato, report the theft to the police and card companies, and so on. Friend A needs to strike rock bottom and decide whether he will begin the process of defeating addiction, and covering for him is not going to help that process along. Perhaps B can make enrollment in an addiction program a condition of his forbearing to tell the police.
posted by jellicle at 2:37 PM on November 8, 2005


Friend A should call his credit card company - explain that there was a mistake on his part and that those charges are legitimate and should be reinstated.

Friend A will then be responsible to the credit card company for the charges in question. As long as they're getting their money they may not investigate further.

However, Friend A should contact the credit card company as soon as possible, as in right now. My sister works in the fraud department of a major credit card company and trust me, friends A and B do not want to be involved in an investigation. This credit card company will often review security tapes from points of purchases as well as interview sales clerks, etc. It is a very common scam to use one's credit card and then report it lost, saying that the charges are fraudulent.

If Friend A used the credit card in the bar, and the bar's security camera clearly shows Friends A and B partying together, and then Friend B is seen in another security tape making some other charges Friend A reported as fraudulent, Friend A could be in serious legal trouble. It could appear that Friends A and B are in cahoots. Friend A should call the credit card company right now, explain the situation, and offer to pay for the charges. Seriously.
posted by peppermint22 at 2:46 PM on November 8, 2005


Sorry - switch Friends A and B above.
(Can't we just say Larry and Moe?)
posted by peppermint22 at 2:49 PM on November 8, 2005


Friend A already broke the law. (Stealing the wallet, and fradulent use of credit cards). And the 'authorities' were involved once Friend B told the credit card company that these weren't his/her charges.

It might be too late to take the authorities out of it. The CC companies probably have already gotten copies of the fraudulently signed receipts from the merchants and can demonstrate that it wasn't Friend B signing.

Possibly worth a try: Friend B could try saying to the CC companies "oh wait, no, I really did make those charges" and offer to pay it all (presumably collecting the money from Friend A). But if they've been reported as stolen, then has a police report been started on this yet? If so, it'll be more difficult for Friend B to back this train up. Then the question will be why did Friend B report the card as stolen and dispute the charges if it was all legit in the first place? If the police are involved I think it's unwise to lie about what has transpired lest Friend B ends up in hot water too.

At this point I think Friend A needs to feel the consequences of their actions. Without getting proper help, Friend A is doomed to continue the same patterns over and over. Next time it might be over something more serious than a few hundred dollars. No matter what happens with law enforcement, if you care about Friend A, please GET THEM HELP.
posted by raedyn at 2:52 PM on November 8, 2005


pay the credit card charges and either have your friend refund you or suck it up and save your friend's ass if you don't want to press charges. if you can afford to pay the 400 dollars out of your own pocket, of course

and protect better your wallet next time
posted by matteo at 3:07 PM on November 8, 2005


If we have learned anything from current events in America in the past few years, it is that the coverup is always worse than the crime. If I were Friend B, I would be very concerned that I might be committing credit card fraud myself by lying to the CC companies about what happened. I would be so concerned that I would talk to a lawyer about the legality of my anticipated conduct. I would expect Friend A to foot the bill for the lawyer, too. If you're unsure about something as serious as credit card fraud, ask a lawyer for advice. A few hundred bucks now might save you a lot of trouble down the line.
posted by gokart4xmas at 3:13 PM on November 8, 2005


someone has to pay the bank. otherwise we end up paying for your friendship. and that jerk isn't my friend.
posted by andrew cooke at 3:20 PM on November 8, 2005


"11/09/05

Fraud Department
Credit Card Issuing Company
123 Any Street
Anytown, USA 12345

TRANSMITTED VIA FACSIMILE
Hard copy sent via USPS to follow

Dear Credit Card Issuer --

I recently reported that certain charges [insert list here] made to my Visa/Mastercard/AmEx account were fraudulent. At the time that I made this report, I was unaware that these charges were made by a friend who believed in good faith that I had granted my permission for him/her to use my account to make the purchases listed above.

Due to this personal misunderstanding, I can no longer assert that these charges are fraudulent and wish to call any investigation into the nature of these charges to a halt. I take full responsibility for the full sum of [insert amount here] and will pay that sum and any applicable finance charges which may arise, in full, in accordance with the Cardholder Agreement I have signed.

If further information or authorization is needed from me, please feel free to contact me.

Thank you,
Friend B.

cc: personal files
My Town Police Department (if necessary)"
posted by Dreama at 3:30 PM on November 8, 2005


I know of a similar situation where A & B where roommates. A ran up charges of several thousand dollars (B didn't reguarly use the card - it was stashed for emergency uses only). A carelessly used the card -- including on camera in various locations, and in some instances, signed her own real name!

B found out not by confession of A, but by being called to the police station to watch a video of who was using the card. Unmistakably to B the person in the video was A, though B told the investigator that she didn't recognize the person.

No further action was taken.

Perhaps this is just the Austin PD though -- last year a guy I knew stole some electronics from my apartment. My neighbor witnessed the guy leaving my apartment (after breaking in). Soem days later, upon confronting this guy, he confessed - in front of me, other witnesses, and in writing. Despite what seems to be a clear-cut case, APD would still do nothing (because the guy was "no longer in possession of the stolen goods")
posted by fourstar at 3:59 PM on November 8, 2005


First: I am not a lawyer, a law enforcement officer or an employee of any credit card card company, just some net.doofus giving a personal opinion that it might be stupid to take as advice. That said:

I think Friend A should never have admitted it but should never presume on Friend B again; likewise I think Friend B should assume it really was Friend A no matter what s/he said and be much more careful next time (if there is a next time). I do think A owes B something, even if it doesn't cost B anything, for putting B through the trouble; I also think telling B was a mistake because if B doesn't know for sure and can't prove it was theft by A then B is not intentionally committing fraud him/herself.

I do not favor reporting a friend to the cops for something like this where the credit card company will eat it, because I value loyalty (even if you ditch the friend over it), and because I don't care a bit for usurious credit card companies anyway. (I've never had any credit cards myself and won't get any, but I have been in similar situations -- on both sides.)

And anyway, with interest rates being like 24% I regard credit cards as toys for idiots in the first place. One can't always pick problem-free friends, but one can avoid filling out applications for credit cards. Credit card companies are legal loan sharks, people.
posted by davy at 4:03 PM on November 8, 2005


I would be very concerned that I might be committing credit card fraud myself by lying to the CC companies about what happened.

Credit card fraud is buying stuff and then not paying for it.

Telling them you're responsible for the charges anyway, and paying them, is not fraud. Lying to them about the backstory is a white lie nobody cares about. They hear white lies all day, every day. For the most part these are noise.

They really honestly do not care about the signatures, only that they are getting their money.
posted by dhartung at 4:22 PM on November 8, 2005


B should still change the card numbers, just in case A wrote down /remembers the numbers and relapses again.
posted by crabintheocean at 4:31 PM on November 8, 2005


Let me get this straight: in your country, someone who is not the signatory to a CC can legally borrow it? How does he authenticate the purchase? Surely someone always checks the signature in face-to-face transactions? How does a shop assistant or waiter tell between a stolen card and a borrowed one? Colour me confused.
posted by dash_slot- at 4:44 PM on November 8, 2005


dash_slot-: they don't. in restaurants, they run your CC, bring you a receipt (+ the card), you sign the receipt, take the card, and leave. they never see you sign.

shops will give you a receipt to sign but will most often not look or care about the signature.
posted by devilsbrigade at 5:04 PM on November 8, 2005


Offtopic, but here you go dash_slot: The Great Credit Card Prank.
posted by BorgLove at 5:34 PM on November 8, 2005


Keeping this A/B stuff sorted is too hard.

Friend Addict needs help. It's good that he eventually owned up to the deed, but at the point where he's stealing from people and willing to do something that could destroy a friendship, Friend Addict needs to get into a recovery program now.

Friend Pushover's ability to forgive so quickly is admirable, but insulating Addict from the consequences of his addiction is just helping keep the destructive cycle going that much longer before he finally his rock bottom.

Friend Pushover should be truthful with all parties involved, police included. They'll decide whether it's worth the bother of a prosecution anyway (for $400, no injuries, and restitution already made, this isn't something to waste a lot of court resources on y'know). The best Pushover can hope to accomplish in this situation is to not be dragged down along with Addict. All he can do now is hope that being questioned by the police will shake enough sense into Friend Addict that he gets into rehab before f$cking up even bigger. Anyway, if he does end up facing charges, they may give him a firm shove toward a rehab diversion program anyway.
posted by nakedcodemonkey at 5:49 PM on November 8, 2005


They really honestly do not care about the signatures, only that they are getting their money. - dhartung

You're half-right. They only care about getting their money. The reason they care about the signature is this: they demand the marchant produce the slip with the correct signature. If this isn't possible, they make the merchant pay the charges. I used to run a gas station and was regularly required to produce signed receipts (in a very short time frame) and if we didn't have them, we were out the money, not the CC company.
posted by raedyn at 6:27 PM on November 8, 2005


Actually, the issuing bank will be sending out an affidavit to the cardholder to sign saying that the charges were fraudlant. They may have temporarily suspended those charges, but they can easily put them back. If that statement isn't returned, the credit card company will then just recharge the card. The cardholder should contact them by phone and tell them the charges are not fraudlant and to recharge now to the new card. No mention of the other friend is even needed.

I can't see where you said if the police are/were involved, but if they are, then the cardholder needs to tell them the truth about the friend so he/she isn't seen as filing a false police report or something similar. But most people don't contact the police for credit card fraud, so I think the only "authorities" the cardholder will be dealing with is the credit card companies. And they just want their money.
posted by cyniczny at 6:37 PM on November 8, 2005


When friend B stole your cash, he committed an offence against friend A, which friend A can decide to forgive.

Since the credit card company assumes responsibility for all but $50 of any fraud, friend B committed an offence against the credit card company (let's call them "friend C"), which the credit card company will more than likely vigorously pursue, and any attempt on the part of friend A to interfere (for example, by trying to play the charges off legit) will result in friend A's being an accessory to the fraud.
posted by jimfl at 7:25 PM on November 8, 2005


nakedcodemonkey's advice is excellent. Pushover Friend can certainly choose not to press charges, should it come to that, but Addict Friend needs to be exposed to some consequences of his bad behavior. Otherwise, what's to keep him from doing it again to Pushover Friend -- or maybe to you (or another one of your friends) next time?
posted by scody at 7:35 PM on November 8, 2005


Personally I think stealing from a friend is pretty low, even if the friend isn't out anything, but turning a friend in to the cops for something so relatively minor is even lower. Nobody was killed, nobody was seriously injured, nobody was raped, nobody contracted a terminal disease and nobody was psychologically ruined for life, all things that might well happen to the turned-in friend. It's rather disproportionate, I'd say overkill; there are things worth wrecking a friend over, but this ain't one of them.

Guard your wallet, spread the word among your circle that he's got this problem that makes him hard to trust, ditch him, even beat him up, but don't snitch him out to the pigs over a couple hundred bucks. (He sounds stupid enough to get caught sooner or later anyway.) On the other hand, if you do decide that stealing a couple hundred bucks from you is worth death or dismemberment you should be strong enough to do it yourself, or at least capable of jumping for joy if you find out the guy has AIDS and liver cancer. (And personally I think somebody who'd take a friend's life over a couple hundred bucks is scarier than a thieving druggy.)

Recommending drug treatment on the other hand would be a good idea: anybody gone enough to steal a friend's wallet over it clearly needs help. Maybe hand him a list of treatment options and say "Come see me when you're clean, but till then bye-bye."
posted by davy at 9:50 PM on November 8, 2005


I third nakedcodemonkey. It's better advice for all concerned. Pushover friend needs to go to the police and tell everything. Not file charges. Remind them of the restitution made. Then when that's all on record with the police, call the CC companies. Pushover friend's credit rating will worsen, however, no matter what.
posted by paperpete at 9:38 AM on November 9, 2005


Why would his credit rating worsen? If I lose my credit card (or have it pick pocketed) and someone maxes it out, why am I responsible? That's why I'm not caring around cash right... the onus should fall onto the shop owner who didn't verify to make sure the credit card was being used by the right person (a quick ID check would suffice).

PS, write "PLEASE CHECK ID" in the signature area on the back of the credit card. I do this to everything I have and they always check my ID.
posted by geoff. at 10:06 AM on November 9, 2005


FWIW

I work in credit card collections and when I speak to someone who tells me that their card was used without their knowledge I offer two suggestions:

1. File fraud paperwork against the person who used the card and involve the police to settle the matter

or

2. Pay your goddamn bill and stop crying about it.
posted by Makebusy7 at 10:13 AM on November 9, 2005


Of course you do, Makebusy7, that's why you still work in credit card collections. If you said "Oh forget it, VISA charges you a 24% APR so they afford $300 bucks" they'd fire you from your shitty job quicker than you can say "I wish I were a janitor at Wal-Mart."
posted by davy at 3:31 PM on November 9, 2005


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