Highlights from the Dave Ramsey Show

QUESTION: Nancy on Twitter asks if a wife takes out a credit card in the husband's name without his knowledge, and they get divorced, can he claim identity theft?

ANSWER: Yes. Anytime anyone opens an account in a name other than their name—unless they have a power of attorney—they have stolen an identity. Just because you're married to someone does not give you the right to sign their name.

I actually knew a guy in the real estate business years ago that was buying and selling a lot of property, and he was doing a lot of deals and he was doing them in his personal name. Occasionally, the title company would require his wife's signature, and he just signed her name. He ended up going to jail for criminal fraud. He got a felony charge for criminal fraud. He'd call his wife on the phone, and she knew it was going on and he signed it. Then he signed some stuff probably she didn't know about. There was no power of attorney on any of it, and it all came back and bit him in the butt.

You cannot sign your spouse's name without a power of attorney. It's called identity theft. It is criminal fraud. Anytime you lie to get money—that's one of the basic definitions of fraud.

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Question: Jared in Colorado Springs just returned from a deployment. While he was gone, he gave his mother power of attorney to take care of his bills. She ignored all of his financial obligations and used the money to pay for nursing school among other things. He's now $50,000 in debt due to her actions, and he isn't getting any help because of her power of attorney. What should he do now?

Answer: The only person who did anything wrong was her. With the power of attorney she is supposed to act, in a fiduciary role, only in your best interest. That's the legal theory. I'm not a lawyer, but I do know that much. Obviously she did not act in your best interest; she stole the money. I would think at least a civil suit could be brought against her, and even possibly criminal.

How does she sit in the room with you and look you in the face after doing this? This is just heartbreaking. Obviously you could sue her into next week, but she's got no money. Criminal restitution could work here if you get a district attorney to get excited about this and work this for you. But in the meantime you've still got to do the practical stuff to get current, and that could take two years.

I would start arguing with the credit card company and make it hard on them. They did nothing wrong by issuing the card when she had a power of attorney. But it was a misuse of this, and I would force them to collect from her. Give them her work information and all her phone numbers. Give them her address. Give them her dog's name. Turn them loose on her. Let them have a little fun chewing on her for a while. At least she needs that.

Then you have to decide if you want to pursue this criminally or not, if you can. I'm not an attorney but it sure sounds like you'd be able to.

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Question: Angela in Huntsville says her bank account was tapped for $800 that she didn't spend. She went to the bank, and now she's getting the runaround. This debit card mess makes Dave angry.

Answer: Tell them they have 24 hours to put the money back, or you're going to turn them in to the Office of the Comptroller. "Do it right now. I'm going to the state. I'm going to the feds. Don't you screw around with this. And I'm going to Visa, too, because Visa guarantees this." They guarantee against fraudulent charges. It should not be two or three weeks. I would not tolerate 24 hours. Visa has a 100% guarantee on any fraudulent transactions over a debit card.

They need to put the money back while they're investigating. It's simply a fraudulent transaction. "I didn't do it, and I want it in there right now." Get all up in their stuff. If they don't do it, change banks because a bank is supposed to cover that stuff instantaneously. There's nothing to this. It's a very open-and-shut case.

There's all this stuff going around, folks, that debit cards don't have the same fraud protection that credit cards do, and they absolutely have the exact same fraud protection—exact same. If it's a Visa or MasterCard debit card and a fraudulent transaction occurs, you are simply not liable. And they're not allowed to screw around with it for two or three weeks figuring it out. Put the money back. Then if they can prove that you actually did it later, then we can do something else. But in the meantime, they put the money back. That's not going to fly. These people out there saying the problem is this or that, the debit cards don't have the same protection—they have the exact same protection. It's a zero liability in the event of fraud or theft.

The debit card does have two mechanical things that it does. One is you swipe it through and you use it like a credit card. That's how I use my debit card. That runs through the Visa system—if it's a Visa card—and is protected 100% in the event of fraud or theft. If you use your debit card as an ATM function, then what you get is you're using your PIN, and you are not on the Visa system and you do not have the Visa protections. You only have the same protection as an ATM has, so fraud protection would vary from bank to bank in that situation.

A debit card has the exact same fraud protection. It's right there on Visa's website. You can go there and read it on the site. It's a zero liability for the consumer. Zero.

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