United States Senator Charles E. Schumer warned Christmas shoppers today to be aware of gift card scams that could result in the cards having zero balances on them by the time they are opened on Christmas morning.
Gift cards for dozens upon dozens of retailers are now readily available for purchase at drug and convenience stores and displayed on easily accessible shelves, making account information on the back of the cards available to would be scammers. Scammers are able to obtain account information from the back of cards, wait for the cards to be activated upon purchase, and then use them online before the intended recipient ever gets the gift card on Christmas morning. Schumer is warning last minute Christmas shoppers to pay particular attention to any tampering of gift cards and asking retailers to consider displaying gift cards in more secure locations or behind the counter.
Each card has an account number on the back of it, which allows consumers to use the cards online when they are shopping. In addition to the account number, many cards have small access codes or pin numbers that consumers must enter when they shop online. In most cases, account numbers themselves are exposed when cards are on the shelf, while access codes and pin numbers are concealed with a scratch-off film. While some gift cards are fully packaged in cardboard and must be torn to gain access to the card, most allow easy access to the reverse side of the card allowing scammers to copy the account number and scratch-off access codes.
Once the card is legitimately purchased by a consumer, and activated at the register at the point of sale, scammers can use the account information they previously obtained from the store shelf and make purchases online, wiping out the balance. Scammers simply wait for the gift card to be legitimately purchased, and by periodically trying to use the card online, they can figure out when it’s been activated for use. Because most cards are bought as gifts and not opened or used until after Christmas, consumers are unaware their card has a zero balance until after they try and redeem it, sometimes weeks after the holidays.