Abstract: Protecting Plastic: Credit Card Fraud and the Defense of America's Credit Currency

Sean H. Vanatta

Abstract

This paper takes up a simple irony, namely that the credit cards issued by banks and companies like American Express in the 1950s and 1960s functioned as a new form of money, but the companies issuing them forgot to consider one thing: people like to steal money. Hilarity, needless to say, did not ensue. Instead, as I will show, credit card companies pursued a mixture of strategies to combat escalating card fraud. They sought to recast the image of fraudsters from ''elegant swindlers'' to ''professional criminals,'' they hired internal security forces to track down miscreant card users, and, most important, they sought to harness state policing capacity to protect their new card products. These efforts yielded—and continue to yield, as any recent Target customer knows—mixed successes, and in the late 1960s brought new state scrutiny to the industry, and with it, new consumer protections. In examining this case, particularly the development of credit card fraud legislation in New York state in the late 1960s, I suggest that scholars begin to consider criminal law as a form of financial regulation as important as, and intertwined with, consumer protection and safety and soundness.