Kay Kirk had paid the outstanding balance on her MasterCard credit card, and had made no further purchases with the card for three months. Then, she was shocked when a statement arrived by mail showing assorted charges on the card for a total of $2,700 . She quickly checked her wallet and found her card. Must she pay the $2,700?

No. If the card that had been used was a counterfeit, she had absolutely no liability. The result would be the same if her credit card number had somehow been illegally obtained by a computer hacker (perhaps on the Internet) and had been used to make the purchases. If the card that had been used was hers, but had somehow been obtained by a thief, used, and then returned to her wallet, she is liable to a maximum amount of $50 under the federal Credit Card Act of 1970, because she had failed to notify the card issuer before the unauthorized purchases had been made. Persons should guard their credit cards as they guard cash. The $50 per card potential loss is probably less intrusive than the hassle of clearing up the fraudulent charges. If a person discovers the missing (whether lost or stolen) card they should immediately—day or night—notify the issuer. If they act fast enough, they may not have to pay the $50 per card.