Fraud alert: Gift cards are sold out, state officials say

Wausau Driver and Review

Wisconsin Department of Agriculture, Commerce and Consumer Protection
(DATCP) recently received several complaints from consumers after they discovered that their newly purchased and unused gift cards contained no funds.

Many consumers have reported that although there is no evidence of tampering on the cards or packaging, they contained a zero balance before they were even used. Some consumers have reported that their gift cards run out within 20 minutes of activation.

Technology, such as bots, can be the source of this fraud because there is a short window of time between the purchase of the gift card and the funds on the card being exhausted. Robots are software applications that perform digital tasks at high speed. Criminals can use bots to automatically check retailers’ online gift card balances and determine which cards have been activated.

These bots can search thousands of card numbers per second and notify the criminal as soon as they find one with a balance – potentially just seconds after the card has become active. The criminal can immediately use the card to make purchases or sell the card information on the dark web before the consumer uses it.

Another possible cause of this problem is physical tampering. Criminals can conceal forgery by using devices such as magnetic card readers, which can read and record card numbers without leaving any evidence. Criminals later call the card’s customer service number or use bots to find out when the card is activated and deplete its funds before the consumer has a chance to do so themselves.

DATCP recommends the following to avoid scams similar to gift cards:

  • Buy your gift cards directly from a known and trusted source.
  • Don’t buy gift cards from online auction sites, as they could be stolen or used up.
  • Activate gift cards just before giving and/or redeeming them.
  • Use gift cards quickly after receiving them.

For more consumer protection information and resources, or to file a complaint, visit DATCP’s consumer protection webpage at ConsumerProtection.wi.gov. If you have questions or think you’ve been scammed, report it by calling the DATCP Consumer Protection Hotline at (800) 422-7128 or emailing [email protected]

Michael N. Clark