Credit Card Fraud and Forgery

A credit card case in New York rarely arrives as a single charge. A person who uses someone else's card at a store may face a larceny count for the goods, a possession count for the card itself, a forgery count for the signature on the receipt, and an identity theft count for using the cardholder's name. Each count carries its own classification, and the felony counts do not depend on how much was spent. Our firm defends people charged under these statutes in New York criminal courts, from the first appearance through trial or negotiated resolution.

How New York Defines a Credit Card Offense

The Penal Law does not contain a single statute called "credit card fraud." Prosecutors instead draw from several articles, and the charging decision often turns on what the accused did with the card and what the accused knew about it. Penal Law § 155.00(7) adopts the definition of "credit card" from General Business Law § 511, and § 155.00(7-a) does the same for debit cards. The most common charges are these:

• Grand larceny in the fourth degree, PL § 155.30(4): stealing property that "consists of a credit card or debit card." This is a class E felony regardless of the card's limit or whether it was ever used. Taking a card from a wallet is a felony on its own.
• Criminal possession of stolen property in the fourth degree, PL § 165.45(2): knowingly possessing a stolen credit or debit card with intent to benefit oneself or impede recovery by the owner. Also a class E felony. Possession of a single card is enough.
• Theft of services, PL § 165.15(1): obtaining services, such as a hotel room or restaurant meal, by using a card the person knows is stolen. Class A misdemeanor.
• Unlawful use of a credit card, debit card or public benefit card, PL § 165.17: using or displaying a card the person knows has been revoked or cancelled, in an attempt to obtain goods or services. Class A misdemeanor. This section also reaches Electronic Benefit Transfer cards, which is why some clients charged under it also face scrutiny described on our public benefits fraud investigation page.
• Petit larceny or grand larceny by value, PL §§ 155.25 through 155.42: for the goods actually obtained. Under $1,000 is a class A misdemeanor. Over $1,000 is a class E felony under § 155.30(1). Over $3,000 is a class D felony under § 155.35(1).
• Scheme to defraud in the first degree, PL § 190.65(1)(b): a systematic ongoing course of conduct that defrauds more than one person and obtains property in excess of $1,000. Class E felony. Prosecutors reach for this when a person used multiple cards or hit multiple merchants.

Forgery and Forged Instrument Charges

Forgery is charged when a person falsely makes, completes, or alters a written instrument with intent to defraud. The classification depends on the type of instrument. Penal Law § 170.10(1) lists "credit card" by name among the instruments covered by forgery in the second degree, alongside deeds, wills, contracts, and commercial instruments. Forgery in the second degree is a class D felony.

New York courts have treated a credit card sales slip as an instrument that "does or may evidence, create, transfer, terminate or otherwise affect a legal right, interest, obligation or status" under § 170.10(1). Signing another person's name on a merchant receipt or a chip-and-signature terminal can therefore be charged as a D felony, separate from the theft of the goods.

The companion possession statutes work the same way. Criminal possession of a forged instrument in the second degree, PL § 170.25, is a class D felony and applies to holding a forged instrument of the type listed in § 170.10 with knowledge that it is forged and intent to defraud. A re-encoded gift card, a cloned card bearing a stolen account number, or a card with an altered name falls within this section. Forgery in the third degree under § 170.05 and possession in the third degree under § 170.20 are class A misdemeanors, and a reduction from the second-degree count to the third-degree count is a frequent negotiated outcome when the instrument's legal effect is arguable.

Identity Theft and Skimming Devices

When the accused used the cardholder's name, account number, or other personal identifying information, prosecutors add charges under Penal Law Article 190:

• Identity theft in the third degree, PL § 190.78: assuming another person's identity and thereby obtaining goods, money, or services, or causing financial loss. Class A misdemeanor.
• Identity theft in the second degree, PL § 190.79: the same conduct where the aggregate value exceeds $500, or where the person commits or attempts a felony in the course of assuming the identity. Class E felony.
• Identity theft in the first degree, PL § 190.80: aggregate value over $2,000, or commission of a class D felony or higher. Class D felony.
• Unlawful possession of personal identification information, PL §§ 190.81 through 190.83: possessing account numbers, PINs, or other data with intent to use them unlawfully. Third degree is an A misdemeanor. Second degree, under § 190.82, becomes an E felony when the person possesses 250 or more items of information or has a prior conviction.
• Unlawful possession of a skimmer device, PL §§ 190.85 and 190.86: possessing a device designed to read and store card data with intent to use it unlawfully. Second degree is an A misdemeanor. First degree, for a person with a qualifying conviction within the past five years, is an E felony.

Identity theft charges also appear when stolen card data is used to open accounts or file benefit claims in another person's name. If your case involves a fraudulent unemployment claim, see our page on unemployment insurance fraud, which describes how the Department of Labor investigates those claims.

Sentencing Exposure by Classification

For a first felony offender, the court is not required to impose prison on a class D or E non-violent felony. Penal Law § 70.00(4) permits a definite sentence of one year or less, and § 65.00 permits probation. Restitution is ordered under PL § 60.27, which caps restitution at $15,000 for a felony and $10,000 for a misdemeanor, but § 60.27(5)(b) allows the court to exceed those caps to cover the victim's actual out-of-pocket loss. A five percent collection surcharge is added.

A conviction under PL § 170.10 or § 190.80 has consequences beyond the sentence. Fraud and forgery convictions are treated as offenses involving dishonesty, which affects professional licensing, employment in banking and finance, and immigration status for non-citizens. Sealing under CPL § 160.59 is available for up to two eligible convictions, but only after ten years have passed since sentencing or release.

Two Worked Examples

Example one: a found card used at a pharmacy

A person finds a debit card on a subway platform, keeps it, and uses it at a pharmacy to buy $140 in merchandise, tapping the card at a terminal that requires no signature. The likely complaint charges criminal possession of stolen property in the fourth degree under PL § 165.45(2), a class E felony, based on possession of the card alone, and petit larceny under § 155.25 for the goods. If the person found the card rather than took it, § 155.30(4) grand larceny does not fit, and a defense attorney will press that point at the outset. The felony count turns on knowledge that the card was stolen, and a card found on the ground is not necessarily "stolen" in the statutory sense. The realistic negotiated range is a misdemeanor plea with restitution of $140, or an adjournment in contemplation of dismissal under CPL § 170.55 for a person with no record.

Example two: a cloned card and a forged receipt

A person presents a card encoded with another customer's account data at an electronics store, buys a $2,400 laptop, and signs the cardholder's name on the receipt. Expect forgery in the second degree under § 170.10(1) for the signed slip, criminal possession of a forged instrument in the second degree under § 170.25 for the cloned card, identity theft in the first degree under § 190.80 because the value exceeds $2,000, and grand larceny in the fourth degree under § 155.30(1) for the laptop. Three D felonies and an E felony arise from one transaction. The defense focuses on whether the prosecution can prove the accused knew the card was encoded with someone else's data, and on the video, receipt, and terminal records the store retained.

Procedure and Deadlines After Arrest

Many misdemeanor card cases begin with a desk appearance ticket issued under CPL § 150.20. The ticket sets a return date for arraignment, and failure to appear results in a warrant. Felony cases usually begin with a custodial arrest and arraignment on a felony complaint within 24 hours.

If you are held after arraignment on a felony complaint, CPL § 180.80 requires release on your own recognizance if the prosecution has not obtained an indictment or begun a preliminary hearing within 120 hours, extended to 144 hours when a Saturday, Sunday, or legal holiday intervenes. A person arraigned on a Friday afternoon and held must therefore be indicted or released by the following Thursday afternoon.

Under CPL § 190.50(5)(a), you have the right to testify before the grand jury, but only if your attorney serves written notice on the district attorney before the grand jury votes. Deciding whether to testify is one of the earliest strategic choices in a felony card case.

Discovery is governed by CPL Article 245. The prosecution must disclose its initial discovery, including surveillance video, bank and merchant records, and any statements attributed to you, within 20 days of arraignment if you are in custody and 35 days if you are not, under CPL § 245.10(1)(a). The prosecution cannot validly announce readiness for trial until it has filed a certificate of compliance with discovery under § 245.50.

Speedy trial limits under CPL § 30.30 run from the commencement of the action. The prosecution must be ready for trial within six months on a felony and within 90 days on a class A misdemeanor, excluding periods attributable to defense adjournments and other statutory exclusions. For a felony complaint filed on March 1, the six-month clock expires on September 1 unless excludable time applies. A motion to dismiss under § 30.30 is filed when the chargeable time exceeds the limit.

The statute of limitations under CPL § 30.10(2) is five years for these felonies and two years for misdemeanors, measured from the date of the offense. Card cases are sometimes charged long after the transaction because the bank's fraud investigation takes months, so the limitations period should be checked against each transaction date in the complaint.

Defenses We Examine

• Knowledge: Nearly every statute above requires proof that you knew the card was stolen, cancelled, forged, or belonged to another. A card handed to you by a friend, a spouse, or an employer with permission to use it is not a stolen card as to you.
• Authorization: Family members and domestic partners are frequently charged after a dispute when the cardholder revokes permission that was previously given. Text messages, prior transaction history, and the cardholder's own statements to the bank can establish authorization.
• Identification: Store video is often grainy, and merchants identify suspects from stills days after the fact. The terminal record proves that a card was used, not who used it.
• Value: The line between an E felony and a D felony under Article 155, and between the degrees of identity theft, is drawn at specific dollar amounts. The prosecution must prove value with competent evidence, and aggregation of separate transactions is permitted only when they are part of a single intent.
• Suppression: Cards, skimmers, and phones are typically recovered in a search. If the search lacked a warrant or valid consent, a motion under CPL § 710.20 seeks to exclude the physical evidence and any statements that followed.

People who receive public assistance are sometimes charged under PL § 165.17 for using an EBT card after benefits were suspended, or under Article 155 for benefits obtained through unreported income. Those cases carry the added risk of administrative disqualification and recoupment, which we discuss on our public assistance fraud page.

You can contact the Law Offices of Albert Goodwin by phone at 212-233-1233 or by email at [email protected].