Credit Card Liabilities and Fraud - Essay Example

Credit Card Liabilities and Fraud Credit Card Liabilities and Fraud Legal Rights Furman Smoogie, who was a sales and marketing representative, had lost his American Express card. He realized that he had lost the card after one week when he took Warren Sacasmano (client) to lunch at a fancy steakhouse. After noticing that he had lost the card, he used the Visa card to make the payment. Furman had lost the card and never realized until one week was over. He was not using the card and could not notice that it was missing.

He realized when he intended to make the payment using the card. In this situation, Furman did not notify American Express about the loss of the card within the required time. There are many circumstances in which an individual is held reliable for fraud involving his own card. Furman had the right to report in writing to American Express in order to stop the loss or an act of fraud. American Express could have stopped any loss or theft from taking place if Furman had notified them earlier.

Furman knew the place where he left the card and has the right to sue the bar for compensation for any loss (Tracy, 2005). If the bar caretakers or owner had used the card to make more transactions, Furman has legal rights to sue the owner demanding compensation of damages. Probability of Paying American Express for Legal Charges Banks hold an individual liable for the transaction involving their card if they fail to report theft or loss of cards. On the other hand, banks do not hold individuals liable for fraud if the transaction is done by fraudsters while the card is not lost or stolen.

In case an individual reports the loss of the card two days after the card is lost or stolen he or she pays $500. When an individual fails to report the loss of a card for more than 60 days, he or she incurs a loss of money lost in his or her account. In this case, Furman noticed the loss of their card after one week and he will pay American Express a total of $500. In case the card is presented by the fraudster in person, the card issuer does not hold the owner liable for fraud charges involving more than $ 50.

In case the fraudster uses the internet or phone to carry out fraud the card issuer can not hold the owner of the card liable. The owner of the card should also notify the bank of the issuer of the card as soon as possible because it is difficult to identify that the card was lost or stolen. In this situation, Furman did not notify the bank and it will be difficult to clear the doubt (Nolo, 2015). Steps to Take to Protect from Loss of Card In protecting the card, Furman will have to take some steps in the future.

For safety, the PIN should be kept secret or not carried in pursue pocket or wallet. The card transactions should be checked carefully. An individual should check the card each time to make sure that it is not lost. Lastly, one should check the account activities periodically (Konsko, 2014). References Konsko L. (2014). Who Pays When Merchants Are Victims of Credit Card Fraud? Retrieved June 3, 2014, from http://www.nerdwallet.com/blog/tips/merchants-victims-credit-card-fraud/ Nolo (2015).

Your Liability for Unauthorised Credit and Debit Card Charges. Retrieved March 13, 2015, from http://www.nolo.com/legal-encyclopedia/unauthorized-credit-debit-card-charges-29654.html Tracy R. M. (2005). Reduce Your Risk of Credit Fraud and Identity Theft. New York: The Privacy Trust Group.