When a person takes out a credit card, he is essentially taking out a line of credit with the financial institution that assigned him the card. Under the terms of the card, only the card holder named by the financial institution is allowed to make loans on the card. However, another person can makes charges with the card if he receives the card holder's permission because he is merely acting as the card holder's proxy.
When a person uses a card without a card holder's permission, this is illegal. Under U.S. law, if the person reports unauthorized use, he is only responsible for a maximum of $50 in charges. Either the retailer or the credit card company will be responsible for any charges made without proper authorization. However, if a spouse's name is on the card, it will not be considered an unauthorized use.
Reporting Credit Card Fraud
In order to not be held responsible for the charges on the card, the card holder must report the fraud to his credit card company. He might have only a limited period in which to do this; the period will vary depending on state law. In addition, he might wish to contact his credit reporting agency and his state attorney general's office to ensure that his credit rating is not damaged and the person who used his card is prosecuted. However, if the unauthorized user is a spouse, reporting her actions to authorities might not be the best course of action.
Although a person can technically report a spouse for using his credit card without authorization, it'll create several problems. First, it can be difficult to prove that a spouse used the credit cards without permission, either tacit or explicit. Second, if the credit card company does believe the card holder, the spouse will likely be held responsible for the damages and might even be charged with criminal fraud.