Bankcards have become the preferred means of payment in France, but with their popularity comes increased exposure to the risk of fraud. Faced with this reality, the legislator has put in place a precise legal framework to apportion responsibilities between the cardholder, his or her bank and merchants. Understanding this system is essential for all card users, as it defines the rights and obligations of each party in the event of an incident. The aim of this article is to detail the different types of fraud, the criminal penalties incurred by fraudsters and, above all, the division of financial responsibilities in the event of loss, theft or fraudulent use of your card. We will also look at complex situations such as fake bank adviser scamsto give you a complete overview of existing protection. Whereas the general framework for payment cards is based on a contract between you and your bank, fraud is an exceptional situation where specific rules apply. While the mechanisms of fraud may differ, as in the case of a fraudulent transferHowever, the owner's responsiveness and the bank's vigilance remain key factors. Our firm, experts in bank fraudThe French version deciphers this complex scheme for you.
Understanding the criminal liability associated with the use of cards
Using a bankcard is not a trivial act and involves the responsibility of the user. In addition to simple contractual breaches, certain types of behaviour may fall within the scope of criminal law and result in severe penalties. The classification of the offence will depend on the precise circumstances of the criminal act.
Misuse of a card (after cancellation, false declaration of theft/loss)
Cardholders may be held criminally liable even if they use their own card. Continuing to make payments or withdrawals after the bank has terminated the contract and demanded the return of the card constitutes an offence. Case law generally classifies such behaviour as fraud or breach of trust. Similarly, cardholders who falsely declare their card lost or stolen in order to stop payment after making purchases are committing an offence. They are using a fraudulent manoeuvre to obtain funds or goods that they should not have received, which is the crime of swindling.
Misuse of corporate assets through the use of a company card
When a payment card is made available to a director by his company, its use is strictly limited to business expenses. Use of the card for personal purposes constitutes misuse of corporate assets, an offence under article L. 242-6 of the French Commercial Code. For example, it is a criminal offence for an executive to use the company card to pay for holidays or personal expenses that are not justified in the interests of the company, punishable by imprisonment and substantial fines.
Computer fraud and data system breaches
With the dematerialisation of payments, fraud often takes on a digital dimension. The law specifically criminalises attacks on automated data processing systems. The act of fraudulently accessing or remaining in a computer system, hindering its operation or introducing data into it is punishable under articles 323-1 et seq. of the Criminal Code. The use of hacking techniques to obtain bank card numbers, for example, falls within this scope. The mere attempt to commit these offences is punishable by the same penalties as the offence itself.
Card counterfeiting and falsification: offences and penalties
The manufacture and use of counterfeit bankcards are serious offences, severely punished by the French Monetary and Financial Code. The law provides for a range of penalties covering not only the use of a counterfeit card, but also all acts that help to prepare the fraud.
Acts of counterfeiting or falsification and their use
Article L. 163-3 of the French Monetary and Financial Code punishes the counterfeiting or falsification of a payment or cash withdrawal card with seven years' imprisonment and a fine of €750,000. This provision covers the creation of fake cards ("skimming") or altering the data on a genuine card. The same penalty applies to anyone who knowingly uses a counterfeit or falsified card or accepts payment by this means. Attempts to commit these offences are punishable in the same way as the offence itself. These acts directly undermine confidence in the payment system, justifying the severity of the penalties.
Acts preparatory to fraud (manufacture, possession of equipment)
To make the fight against fraud more effective, the law also criminalises acts that precede the main offence. Article L. 163-4 of the Monetary and Financial Code imposes the same penalties on the manufacture, acquisition, possession or transfer of equipment, instruments or computer programmes designed or specially adapted to commit the offences of counterfeiting or falsification. This provision makes it possible to intervene upstream, even before the fraud is committed, by targeting individuals or networks that equip themselves to create counterfeit cards or pirate data.
Criminal liability of legal persons
Criminal liability is not limited to natural persons. A legal entity (a company, for example) may be held criminally liable for counterfeiting or falsification offences if they have been committed on its behalf by one of its bodies or representatives. Under article L. 163-10-1 of the French Monetary and Financial Code, a legal entity is liable to a fine of up to five times the amount for individuals, i.e. nearly €3,750,000. Additional penalties, such as dissolution, disqualification from certain activities or exclusion from public contracts, may also be imposed.
Theft or loss of the card: shared responsibility
When a card is lost or stolen, a specific liability regime applies to share the burden of fraudulent transactions between the cardholder and the bank. This system, governed by the French Monetary and Financial Code, is based on reciprocal obligations of prudence and diligence. The key to this system is the stop payment, which marks a turning point in the distribution of risks.
Cardholder liability: safekeeping of card and PIN, gross negligence
Cardholders have a fundamental obligation to keep their PIN secret. Article L. 133-16 of the French Monetary and Financial Code requires them to take "all reasonable steps" to protect the security of their card and data. Failure to do so may constitute gross negligence. For example, the courts have ruled that it is gross negligence to leave a card in a vehicle and write the PIN on a document left in the glove compartment. In such a situation, the cardholder may be liable for all losses incurred prior to the stop payment. It is important to note that it is up to the bank to prove gross negligence; the mere use of the card with the PIN is not sufficient to presume fault on the part of the cardholder. Visit contractual relations between the issuer and the holder define these duties of care.
The need to lodge an objection and time limits
As soon as cardholders become aware of the loss, theft or fraudulent use of their card or card details, they are obliged to inform their payment service provider "without delay". This is commonly known as "stopping payment". This is essential because it transfers the risk of fraud to the bank for all future transactions. The cardholder then has thirteen months, under article L. 133-24 of the French Monetary and Financial Code, to dispute an unauthorised transaction. Once this period has elapsed, the transaction is time-barred and no further claims may be made. Judges assess the 'late' nature of the objection on a case-by-case basis, depending on the circumstances and the cardholder's habits in using the card.
Effects of the opposition and allocation of losses (before and after notification)
The stop payment is the point at which liability shifts. For fraudulent transactions carried out *before* the stop payment, the holder's liability is limited. Unless they are grossly negligent, they will only be liable for losses up to a maximum of €50, in accordance with article L. 133-19 of the French Monetary and Financial Code. All sums debited in excess of this amount must be reimbursed by the bank. For all transactions carried out *after* the stop payment, the holder is completely exonerated from liability. The bank is obliged to reimburse all sums fraudulently debited. Once informed, the bank is responsible for taking the necessary technical measures to block any further use of the card. Any failure to comply with this obligation directly incurs the banker's liability.
Exemption from liability of the holder (remote fraud without physical use, counterfeit card in possession)
In certain situations, the holder is fully exempt from liability, even for transactions carried out prior to the stop payment. The €50 limit does not apply, and the bank must reimburse the full amount. This applies in particular to
- When the unauthorised payment has been made without physically using the card (for example, when card details are hacked on the internet). This includes cases of phishing, where fraudsters impersonate the bank to steal card details.
- In the event of a counterfeit card, if at the time of the fraudulent transaction the cardholder was still in possession of his/her original card.
- If the transaction was carried out without the bank requiring strong authentication of the payer, where this is required by regulations.
Legal recourse and support in the event of bankcard fraud
When faced with bankcard fraud, responsiveness is your best asset. The first imperative step is to stop payment immediately with your bank or the inter-bank stop payment centre. This must be followed by a complaint to the police or gendarmerie. You must then contact your bank in writing to dispute the unauthorised transactions, enclosing a copy of the complaint. It is advisable to do this by registered letter with acknowledgement of receipt to keep proof of your action. The bank is then obliged to reimburse you the sums fraudulently debited, subject to the liability rules we have detailed. If the bank refuses to reimburse you, citing gross negligence on your part, for example, it is up to you to contest this decision. In this type of dispute, the assistance of a lawyer with expertise in banking law may prove decisive in asserting your rights and obtaining compensation. Our firm, experts in defending victims of bank fraudcan help you through the process and defend your interests.
Sources
- Monetary and Financial Code
- Penal code
- Commercial code
EN 
FR