THE ETHICAL DIMENSION The TILA essentially is a consumer-protection law. How does allowing a credit-card company to avoid liability—if a card user has apparent authority to use the card—protect consumers?

ATM Corporation of America, Inc. (ATM), manages settlement services for large national lenders. Francis Azur, the founder of ATM, served as its president and chief executive officer until September 2007, when ATM was sold. In July 1997, ATM hired Michelle Vanek to be Azur’s personal assistant. Vanek’s responsibilities included opening Azur’s personal bills, preparing and presenting checks for Azur to sign, balancing Azur’s checking and savings accounts, and reviewing his credit-card and bank statements. Vanek also had access to Azur’s credit-card number so that she could make purchases for him. Over a period of seven years, Vanek withdrew unauthorized cash advances of between $200 and $700, typically twice a day, from Azur’s credit-card account with Chase Bank, USA. The fraudulent charges were reflected on at least sixty-five monthly billing statements sent by Chase to Azur, and Vanek paid the bills by either writing checks and forging Azur’s signature or making online payments from Azur’s checking account. In all, Vanek misappropriated more than $1 million from Azur. When Azur discovered Vanek’s fraudulent scheme in 2006, he terminated her employment and closed the Chase account. Azur sued Chase, seeking reimbursement of the fraudulent charges under Section 1643 of the Truth-in-Lending Act, or TILA. A magistrate judge concluded that Azur’s claim failed because Vanek had apparent authority to use Azur’s credit card. The trial court—a U.S. district court—agreed and granted Chase’s motion for summary judgment on this issue. Azur appealed.