Help, I'm an unauthorized authorized user

Take steps if you're added to a card account without your permission

Your Business Credit columnist Elaine Pofeldt
Elaine Pofeldt is a journalist whose articles on entrepreneurship and careers have appeared in Fortune, Working Mother, Money and many other publications. She is a former senior editor at Fortune Small Business magazine and an entrepreneur herself, as co-founder of, a website for independent professionals. She writes "Your Business Credit," a weekly column about small business and credit, for

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Question Dear Your Business Credit,
One of my employees opened credit cards from my business. Two cards were issued, one in their name and the other in my name and theirs. The fraud department called me several years ago about the overuse of the card with my name on it. At that time I told the fraud department if my name is on the credit card to cancel it. They said I was not the authorizing signer on the account and that they could not close the account.

After the cardholder declared bankruptcy, they wanted me to file a fraud charge. I did not.

My question to you: Because the fraud department would not cancel the card when I requested them to, why do I need to file a fraud charge when I was not the authorized signer? Just to clarify, I did not authorize those cards, nor were any of those cards used for business purposes. – George

Answer Dear George,
Sorry to hear you have to deal with this mess. You must be very frustrated that your employee deceived you in this way.

I don’t have a full picture of the situation from your note. You mention that you did not authorize the cards but they were opened from your business. It’s not clear what you mean by “opened from my business.” You also haven’t mentioned whether you were aware of the cards’ existence or if you ever got a bill. Those facts are relevant to your situation, but since they are not available to me, I’ll do the best I can to address it.

One thing we do know is you were told you were not the authorizing signer and could not close the card. If that is accurate, that would mean you were unknowingly an authorized user. As an authorized user, you can remove yourself from an account but can’t close it. In joint credit, both people have to agree to close the account.

Should you file a fraud report? First, let’s look at whether fraud was committed. I ran your situation past two attorneys and each had a slightly different point of view.

Leslie Tayne, an attorney in Melville, New York, who specializes in credit and bankruptcy, viewed the situation as fraud.

“It is fraud because the employee opened the card without the business owner’s knowledge and without the business owner’s authorization to put it in his or her name,” Tayne said in an email.

However, Jen Lee, an attorney who often advises clients on debt-related matters from her offices in San Ramon and Tracy, California, had a different opinion. Each card issuer has its own requirements as to whom can be added to an account, who has the authorization to change the account, and what is reported, she said in an email.

“It probably would not rise to the level of fraud to add someone as an authorized user without their permission, if that’s all that was done,” Lee said.

That said, the situation is not cut and dried, Lee said. “Another issue here is that it sounds like this employee got a business account for a company he didn’t own or have authorization to apply for credit,” she said.

Given the situation, the credit card company has a pressing reason to want you to file a fraud report.

“There is an exception in bankruptcy for credit obtained by false pretenses, false representations, or actual fraud,” added Lee. “Having it reported as fraud helps their case in bankruptcy court. The credit card issuer may also be trying to cover itself after not having canceled the cards when the reader originally notified them of the issue.”

Protecting the credit card company from losing money may not motivate you, but there are important reasons you should consider filing a fraud report anyway.

For one thing, it will show that you did not authorize the issuance of the card or the charges, Tayne said. “Until this is resolved, it may leave a blemish on not only the company credit but also the business owner’s individual credit,” Tayne said.

Your first step should be getting a copy of your credit report to see if there is any unusual activity listed on it. Is the card in question listed there? If so, call the card issuer and get yourself removed as an authorized user today, because you don’t want to share credit with someone who has declared bankruptcy. Authorized users share the credit history of the authorizer, for better or worse. Allowing your name to remain on the card could deal a body blow to your credit.

If you do find unusual activity, it’s a good idea to file a police report for credit card fraud. We explain why this is to your advantage in our story, “Why you should file a police report for card fraud.”

You might also consider a credit freeze. It is possible that the employee stole your identity and may try to open other accounts in your name. Hopefully, that hasn’t happened, but now is the time to get in front of the situation. It could end up protecting you from a lot of other hassles.

See related: How to remove an authorized user from a credit card account, Use caution when adding a friend as an authorized user

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Updated: 03-24-2019