Could Your Employees Be Inappropriately Using CompanyIssued Credit Cards

Could Your Employees Be Inappropriately Using Company-Issued Credit Cards?

Just think. You issue credit cards to your employees strictly for business use—client dinners, gasoline for travel, flights, etc. Let’s say an employee decides to—without permission—spend his or her card on a nice day at the spa. Even if you ask them to pay for it, legally, you will have to pay.

According to an article from, the employer is legally responsible for paying for any charges made on a company issued card. In a recent article, they pointed to every employer’s worst nightmare: a credit card was stolen (this time, it was a county government’s) and over the span of a year, $31,000 worth of gas was charged to the card.

Why or how these charges went on for almost 13 months is still being investigated. Though no one has been arrested, the state has some video of the card being used at various gas stations.

The county government, located in Pennsylvania, never canceled the card. And unlike personal fraudulent charges (where individuals eventually get their money back), business charges are different. Under the Fair Credit Billing Act, the issuer of the business card must pay for all its expenses.

A source in’s article referenced the time a small business owner gave a delivery driver a credit card for his gas. After the employee left the company, he continued using the company credit card, and the small business owner was liable for all of the charges.

Though most of us assume we can trust those we hire, this example shows that may not be the case. Should legislation be changed so that the individual holding the card is responsible? Or should the company trust its employees’ actions and take responsibility? Let me know your thoughts. 

Posted by Jamie Friedlander on Sep 11, 2013

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