Credit card fraud: Who is liable?

Unfortunately, credit card fraud also occurs time and again in Germany. In most cases, credit cards are stolen directly or hacked and misused. For your benefit as a bank customer, clear liability rules from the German Criminal Code (StGB) and the German Civil Code (BGB) apply to credit card fraud.

However, enforcing a liability claim against your bank regularly requires legal assistance. As your law firm for banking and financial law, we are at your side. Let us advise you on how to proceed in a free consultation.

The most important facts in brief

1. There are several types of credit card fraud, such as card theft, skimming and phishing, but you can often protect yourself against them.
2. If you discover credit card fraud with your credit card, you are generally only liable - if at all - up to a maximum value of 50 euros.
3. If you discover credit card fraud, you should have your card blocked immediately, file a police report and complain about unauthorized charges.

These paragraphs apply to credit card fraud

German law provides several paragraphs for dealing with credit card fraud. On the one hand, the German Civil Code (BGB) is relevant, but also the German Criminal Code.

With regard to the question of liability , section 675v BGB is particularly relevant. This states that the maximum liability of the person concerned up to the time the credit card fraud is reported or the loss of the credit card is reported may amount to a maximum of 50 euros.

In the area of criminal law, under which credit card fraud also falls, Section 263a of the German Criminal Code (StGB) is often used. This refers to computer fraud in which manipulation takes place either at an ATM, on a payment device or on the Internet during data processing.

Section 152a of the German Criminal Code (StGB) also applies to credit card fraud and the resulting damage. This states that the use of counterfeit or stolen credit cards and the associated fraud can result in a fine or prison sentence.

Who is liable for credit card fraud: you or your bank?

In principle, the bank that issued your credit card is always liable. As the cardholder, you rarely have to pay for the damage caused by the fraud.

So-called partial liability may be considered primarily under the following three conditions:

• Credit card was stolen
• You have lost your credit card
• Other loss

In this case, you may have to pay a maximum amount of 50 euros out of your own pocket by the time you report the theft or misuse. How high the amount is in detail depends on the card-issuing bank and its goodwill.

In principle, even full liability of the cardholder is not completely excluded. However, in practice this is very rarely applied, as it presupposes a failure to comply with the duty of care or the contract on your part. Liability is of course also transferred to you if you have cooperated with the fraudster.

The most common case of liability for credit card fraud is that you have to pay 50 euros of the loss yourself. Moreover, this only applies up to the point at which you have had the credit card blocked or have reported the loss. If no loss has been incurred at this point, the bank is fully liable for any further fraud losses.

The bank doesn’t pay? Credit institution must prove your negligence

Closely related to the issue of liability for credit card fraud is the so-called burden of proof. The regulation is very clear in this respect: the burden of proof always lies with the card-issuing bank in the event of credit card fraud.

In other words, the credit institution must prove to you as the cardholder that you acted with gross negligence and that credit card fraud was therefore possible. Such evidence must be provided if the bank wishes to hold you fully liable.

If you have not breached your duty of care, it is very unlikely that you will have to bear a larger share of the damage yourself, if only for reasons of the burden of proof described above.

How a possible proof on the part of the bank could look like is regulated in the BGB, among other things. It states that the credit institution must prove to the cardholder that the credit card has been used "properly". This could be assumed, for example, if correct authentication has taken place. However, this is usually only assumed on the condition that the fraudster has used data such as your personal PIN, which he cannot actually have.

Duty of care violated? What happens in the event of gross negligence

It is particularly important that you, as the credit card holder, have not breached your duty of care if you wish to be completely exempt from liability. But what exactly are the duties of care that you as a cardholder must comply with? The following practical examples show when a breach of the duty of care can be assumed:

• You have noted your PIN on the credit card
• Your PIN was found together (on a piece of paper) with the credit card in your wallet
• You have left your credit card / wallet unattended
• You have sent all card data by e-mail
• You have given your PIN to other people

In this case, it is usually a case of gross negligence, meaning that the bank can hold you at least partially liable for the loss incurred.

How to get your money back with CDR Legal

As the cardholder, you are not usually held liable for the loss in the event of credit card fraud. In most cases, you bear a maximum loss risk of €50 until the card is reported lost or blocked. Only if gross negligence can be proven can partial or even full liability for the damage incurred be considered.

Banks often refuse to to pay for the damage incurred. Arrange a free and non-binding consultation to describe your case and receive initial helpful advice on how to proceed. As a law firm, we specialize in banking and financial law and use our expertise to enforce your claim against your bank.

The perpetrators’ approach to credit card fraud

There are basically several types of credit card fraud. The focus is always on subsequent misuse of the credit card. The fraudster therefore wants to enrich himself from your assets. In the vast majority of cases, the bank assumes liability as long as the cardholder observes certain duties of care.

Credit card stolen (theft)

Many credit cards continue to be physically stolen, for example when shopping or in other situations. In this case, fraudsters can use the stolen credit card immediately. This is because a PIN is not required for every payment; a signature is often sufficient.

Data stolen from credit card when paying or withdrawing money (skimming)

So-called skimming is used by fraudsters to spy on credit card data. In this case, card readers are manipulated, either inside a store when making cashless payments or at an ATM. By technically manipulating the readers, your card data is read and then misused by the fraudsters.

Credit card data stolen through fake emails & fake websites (phishing)

In the age of the Internet, phishing in particular is widespread. In this case, fraudsters try to obtain your card details via links contained in e-mails, which you enter on a fake website, for example. In addition, electronic data theft is also possible via Trojans that have infected your PC.

Data stolen from credit card in online stores (hacking)

Another form of credit card fraud involves data theft from online merchants. In the past, this has even been detected at major online shopping companies, with hackers causing enormous damage with the stolen card data.

Data stolen from credit card by copying machines (copying)

A less common scam is to copy the credit card. This can happen in stores or restaurants, for example, if your credit card is no longer in sight for the payment process.

5 steps to limit the damage: What to do in the event of credit card fraud?

Credit card fraud is not always detected immediately. Not all victims even notice the theft of a credit card within a few minutes, hours or days. It is therefore all the more important that you bear in mind a few points about what you should do after a theft or credit card fraud has been detected:

1. Have your credit card blocked immediately
2. Report credit card fraud and card theft
3. Control your sales with your credit card
4. Complain about unauthorized debits
5. Document all processes

The most important thing is to have your credit card blocked immediately. This is possible via the nationwide blocking emergency number, which you can call at telephone number 116 116 can be reached. Alternatively, you can also call the respective credit card company, which usually also has a blocking hotline.

If you have not lost your credit card, but it has been stolen or you have already discovered fraud with your credit card, it is also strongly recommended that you report it to the police. You should then check your current transactions and the credit card statement for irregularities.

If you discover unauthorized debits due to fraud, file a complaint with your bank. It is also recommended that you document as many figures and data as possible in connection with the credit card fraud, such as the date and time of the theft and the time you had your card blocked.

8 security tips: How do you protect yourself against credit card fraud?

Unfortunately, there is no such thing as 100 percent protection against credit card fraud. Nevertheless, you have several options to at least significantly reduce the risk of data misuse and fraud with your card. Here are a few tips that we would like to share with you:

• Never let your card out of your sight when paying (e.g. in a restaurant)
• Enter your PIN at an ATM or when paying in stores with your hand covered.
• Never open links in emails from unknown senders
• Only use online retailers that offer a secure payment system(SSL connection)
• Do not pass on your credit card details to other people, especially not by e-mail
• Do not write down your personal PIN
• Check your credit card transactions regularly
• Destroy all "external" receipts and statements that show your credit card number