When is an Individual held Liable or Not Liable for Credit Card Fraud?

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About one in 5 persons is a victim of credit card fraud. Sometimes, the victims of credit card fraud get refunded for their loss and other times; they are not. Therefore, it is important everyone is informed on rules surrounding credit card fraud, so they don’t end up on the wrong side of the law in the event of falling victim to a credit card fraud.

The most important first step when an account is compromised is to contact with the credit card provider and notify them of the situation to become a beneficiary of fraud returns in case it occurs.


According to existing legislation by most credit card companies, the customer is responsible for the cost of fraud when:

•    The have acted fraudulently, for instance, they contributed to, were involved in or benefited from the loss, they won’t get a refund.

•    They have proven to be careless: by, for example, writing down the pin number. In this situation, the onus is on the card provider to prove negligence.

•    They failed to inform the bank of a stolen card or a third party knowledge of their PIN

•    When they don’t use the card providers’ 3D Secure system (e.g. Verified by Mastercard, Visa Secure Code)

•    If an additional card holder is held responsible for any of the reasons above.

Despite the right of credit card owners to receive compensation in cases of credit card frauds, when they are found culpable by intentionally compromising their security. The ‘good news’ for credit card holders is that the burden of proof lies with the credit card issuing company.


According to existing legislations, the customers are not responsible for fraud when:

•    Their card was lost or stolen and when they realized, told the bank before the fraud was carried out.

•    A third party knew the users’ pin, and they realized and informed the bank before the fraud took place.

•    Card details are stolen without the cardholder’s knowledge: If it’s an instance of the card not present fraud where the details are taken online.