Former employer says you used business card fraudulently
By Elaine Pofeldt | Published: December 19, 2016
Your Business Credit
Dear Your Business Credit,
My old employer gave me her business credit card to make purchases. Now she's claiming they weren't approved. Does she have grounds to press charges for fraud when she gave me the card and told me to? How can I prove anything if it’s her word against mine? – Jessica
I’m sorry to hear about what is going on. It sounds as though perhaps you and your former employer had a different understanding about what you could and could not legitimately charge.
Can your former employer pursue this matter in court? That depends.
“The most important question is whether the charges made on the credit card were proper,” attorney Peri Berger, an associate with Harris Beach in New York City, advised me in an email. “If they were not, the employer certainly could pursue action to recover the expense. If the charges are legitimate, it is difficult to imagine how or why the employer would pursue any action.”
What if you’re not sure? A good first step for you would be to look back through any records to which you still have access for any documents or emails showing that your employer gave you permission to use the card or that the charges were considered proper by the company. Perhaps when you were hired, you received a manual of policies and procedures that outlined this, for instance. Having records showing that you made purchases considered legitimate could offer you some protection if your former employer does decide to pursue this matter. Even if you no longer have access to your old company email account, you may have used text messaging or your personal email account to communicate with your former boss about the charges, so it is worth doing a search through them.
“It is also important to remember that, while a citizen can complain to the police about action taken against them, it is up to the police and generally the district attorney to decide whether to pursue an action against someone,” noted Berger. “If the employee sounds credible, and in particular if the employee has documentation that shows that the employer asked to have the charges or documentation that shows that the charges were proper, it is hard to imagine anyone pursuing this.”
Right now, we don’t know what your boss’s next steps will be. All we know is that she is telling you that you made charges that were not considered legitimate. If she contacts you again, you may want to ask her to specify the charges she means so you can get back to her on the matter later – but don’t discuss the subject further. If you did make purchases that were not legitimate, you may need to get legal advice before you respond to her. It’s also possible that the charges in question were made by someone else. Given how much identity theft goes on, a fraudster may have made charges of which you were not aware.
Your situation is a good reminder that business owners need to establish written policies about credit card use – and that employees should ask for them, for their own protection. There are many gray areas when it comes to business purchases, and it is all too easy for misunderstandings to take place.
Meet CreditCards.com's reader Q&A expertsDoes a personal finance problem have you worried? Monday through Saturday, CreditCards.com's Q&A experts answer questions from readers. Ask a question, or click on any expert to see their previous answers.
- Options to collect from customers who can't pay their balance in full – When dealing with customers in financial distress, suggesting a payment plan might be the best way to ensure you get full payment ...
- Q&A: Ex-partner was authorized user; is he liable for card debt? – Your ex-business partner could be equally liable for the company's credit card debt even if he was just an authorized user on the card. Here's how to find out ...
- Q&A: Can I charge cards with a mobile app for my side hustle? – If you're operating a side hustle and wondering about your rights when it comes to charging cards on file and paying taxes, make sure you do your homework before you find yourself in trouble ...