Gift cards can seem like the perfect gift, but they can also be a source of fraud. Following are just a few ways that thieves and dishonest employees commit credit card fraud.
- Data theft – scammers copy data from unsold gift cards and use the retailer’s 800 number or website to check the status of the card. Once the card has been activated, thieves use the data to make online purchases or create counterfeit cards.
- Data Planting – scammers clone already purchased cards and plant them in stores. When a cloned card is activated, the money is transferred to the thief’s card.
- Check-out scams – cashiers pretend the card is empty or not activated and persuade the customer to give them the worthless card. Another version of employee scams involves the cashier swapping activated cards with empty look-alike cards.
- Register shut-down – cashiers ring up a gift card and activate it. Before tendering the transaction, they unplug or conduct a hard shut-down of the register.
