What is Credit Card Application Fraud?

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  • Written By: K. Testa
  • Edited By: Michelle Arevalo
  • Last Modified Date: 12 September 2019
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Credit card application fraud is a type of identity theft that involves opening a credit card account in another person's name. By opening an account using stolen information, an individual can cause numerous problems for the victim, including debt, negative credit ratings, and even bankruptcy. In the United States, identity theft is a federal offense. Several government agencies and consumer protection organizations have developed strategies to help victims, and potential victims, deal with fraud on credit card applications.

A common method of applying for an account in another individual’s name involves filling out credit card application forms with counterfeit documents, or by using stolen information about another person. Typically, the applicant either pretends to be someone else, or he or she uses his or her real name and false contact information. The applicant might use stolen documents or have copies of the victim’s personal information, such as utility bills or other financial statements. For U.S. citizens, a key piece of information usually is the victim’s social security number. At first, the injured parties may not even realize what has happened, because they do not receive billing statements. Rather, the correspondence is usually mailed to the address specified on the original application.


Credit card application fraud can have many negative consequences for its victims. Once a fake application is approved, someone can accumulate potentially limitless charges using another person’s identity. These fraudulent charges can lead to huge credit card debt and negative credit reports. In some cases, victims have had to consider filing for bankruptcy because of the damage done by credit card fraud.

Anyone can be a potential victim of credit card application fraud. People who do not protect their personal information may be the most likely targets for this type of identity theft. Often, elderly people are the victims of fraud and scams. Possible reasons include their potential likelihood to be more trusting of someone asking for personal information. They also might be more willing to respond to unsolicited phone calls and email messages.

While it may not be possible to prevent credit card application fraud altogether, there are steps that people can take to decrease their likelihood of being victims. In the U.S., government agencies, such as the Federal Bureau of Investigation (FBI) and the Department of Justice, along with consumer protection offices, like the Better Business Bureau (BBB), are good sources of advice for protecting oneself from fraudulent credit card practices. For example, they often suggest obtaining a copy of one’s credit report to check for any suspicious activity. Another recommendation is to guard one’s financial documents carefully, and to avoid giving out personal information unless it is deemed absolutely necessary.


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Post 4

I received an email from someone with the Subject: Pre-Qualify for a Platinum Visa® in less than a minute

I have no credit and I am trying to build it up. My application was accepted and they said would receive my card in the mail after personal information verification. There was no email sent to my account to verify this or an account for me to access any information. I am now concerned that this was a false application and I am strongly worried about identity theft and fraud against my name. How can I find out if this is fraud?

Post 3

@umbra21 - This is why I tell people to never ever give out their SSN or passport number or anything like that unless they absolutely have to and it's to a trusted organization. Don't even store them in your email accounts, because that's exactly what hackers are looking for when they crack accounts and look for information.

Post 2

@clintflint - It's not just that you're stealing money from them either. Often people who commit credit card application fraud end up defaulting on their payments and completely ruining the credit history of the person they have pretended to be. And it's difficult to correct your credit history, even if you were never in the wrong.

So you aren't just stealing money, you're basically ruining their chances of being able to get loans, or buy anything that needs financing, and maybe even affecting their ability to get a job in the future.

Post 1

They always make this seem like a victim-less crime in movies and TV shows, but I suppose that's not true in real life. They wouldn't make it that easy to commit application fraud because a lot more people would do it if it seemed like they were only going to be ripping off the big companies rather than individual people.

So you basically need to put this on a specific person who actually exists and steal their information, rather than just make up a name and address and then never pay back the money. And that's a really awful thing to do to someone.

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