The Crime of Credit Card Fraud by Retailer - California Penal Code Section 484h
California Penal Code Section 484h defines the crime of credit card fraud by a retailer, though the section applies with equal force to other individuals who are not technically retailers. This section of the Penal Code targets individuals who knowingly process or engage in transactions which involve fraudulent credit cards.
In simple terms, PC 484h PC makes it a crime for a business to commit credit card fraud. This statute applies when a retail business performs a credit or debit card transaction in manner that defraud a customer, vendors or banks.
In some ways, PC 484h is the flip side of Penal Code 484e which punishes individuals who counterfeit credit cards or debit cards and attempt to use them to make purchases. Penal Code 484h by contrast targets the sellers who, knowing that the credit card or debit card they have been presented with is fraudulent, revoked, expired, or otherwise deficient, nevertheless allow the customer to use the card.
If a retailer commits credit card fraud and receives over $950 in a 6 month period, they will be charged with grand theft under Penal Code 487. This type of white collar crime is a “wobbler” that can be charged as either a misdemeanor or felony offense.
If a retailer commits PC 484h credit card fraud and receives under $950 in a 6-month period, they will be charged with petty theft under penal Code 484 and 488, which is a misdemeanor offense.
To give readers more useful information retailer credit card fraud, our California criminal defense lawyers are providing a detailed review below.
Defining PC 484h Retailer Credit Card Fraud
California Penal Code 484h defines credit card fraud by a retailer:
Any retailer or other person who, with intent to defraud (a) Furnishes money, goods, services upon presentation of an access card obtained or retained in violation of PC 484e, or an access card they know is a counterfeit, or forged, expired, or revoked, and who receives any payment, is guilty of theft.
Penal Code 484h also defines credit card fraud by a retailer as presenting for payment a sales slip or other proof of a credit card or debit card transaction knowing that the retailer did not in fact supply the goods or services which were reflected in the sales slip.
This is the crime of running a customer’s credit card and attempting to collect payment from the financial institution connected with the card while in fact not following through on the other side of the transaction.
It should be noted that a retailer defendant retailer must have acted with the “intent to defraud” to be guilty under PC 484h. The term “defraud” means to act in a fraudulent manner by trying to trick someone or to persuade them using dishonest means.
Retailer Credit Card Fraud Cases Examples
A few examples will illustrate these two types of fraud. Suppose that Person A is a retailer who operates a small store. Person B is Person A’s friend. Person A knows that Person B has counterfeited several debit cards. Person A and Person B decide that it would be mutually beneficial for Person A to sell Person B a large amount of goods from Person A’s store which Person B will “pay” for using his counterfeit cards.
Person B will receive the goods, but never actually have the money debited from his account because of the fraudulent nature of the cards. Person A expects to collect from the bank, but knows ahead of time that Person B’s money will not actually be used to satisfy the bill. Person B clearly has his own liability for credit card fraud, but Person A is also liable under Section 484h even though he took no part is producing the counterfeit cards used in the transaction.
In another scenario, Person A and Person B have finished serving their time for the previous fraud and decide to remain friends. This time, Person B decides to purchase goods from Person A using a legitimate card connected to his own bank account.
In the middle of the transaction, however, Person B decides he cannot afford the purchase and asks Person A to cancel it. Person A agrees and no goods exchange hands. However, after Person B leaves the store, Person A runs his credit card number again and falsifies a receipt to reflect that Person B went through with the transaction they had discussed earlier.
In this scenario, Person B is blameless, but Person A is again guilty of credit card fraud by a retailer in violation of Penal Code Section 484h.
Penalties for PC 484h Retailer Credit Card Fraud
The penalties for a violation of Penal Code Section 484h depend on the loss amount, as with other theft crimes under the California Penal Code. If the loss amount totals $950 or less, the crime is a misdemeanor punishable by:
- Imprisonment up to six months in county jail
- A fine up $1,000
If the loss amount is greater than $950, the maximum punishment is:
- 16 months, 2 years, or 3 years in the California state prison
- A fine up $10,000
It should be noted that the loss amount for a violation of Penal Code 484h is not dependent on a single transaction.
If a series of fraudulent transactions within any six-month period exceed $950, the case may be prosecuted as a felony grand theft and expose the defendant to the state prison sentence outlined above.
Related California Offenses for Penal Code 484h
Penal Code 484e – Stealing a credit card
Penal Code 484f – Forging credit card information
Penal Code 484g – Fraudulent use of credit card
Penal Code 484i – Counterfeiting credit cards
Penal Code 484j – Publishing credit card information
Fighting Retail Credit Card Charges
Defenses to an allegation of credit card fraud by a retailer will focus on the retailer’s intent. As in any fraud prosecution, the government must show that the defendant possessed fraudulent intent, that is the intent to deceive someone and thereby receive money to which the defendant knows they are not entitled.
Good-faith disputes between retailer and customer over the value of goods which were purchased should not give rise to a prosecution under Section 484h.
Similarly, if the retailer reasonably believed that the customer’s credit card was legitimate only to discover later that it was in fact a fraudulent card, the retailer is a victim along with the financial institution and not liable under Section 484h.
If you or a family member is being investigated for, has been charged with, has been arrested for, or is in need of consultation regarding an allegation of credit card fraud by a retailer in violation of California Penal Code Section 484h, our experienced Los Angeles criminal defense attorneys can assist you immediately. We will help safeguard your rights and work toward the best possible outcome in your case.
Eisner Gorin LLP is a top-ranked criminal defense law firm located at 1875 Century Park E #705, Los Angeles, CA 90067 and 14401 Sylvan St #112 Van Nuys, CA 91401. Contact us to review the details of your case at (310) 328-3776