Dangerous gift card scam gaining in popularity

[DJRWolf]

Saw this video of a dangerous gift card scam that has been around for a few years but recently has exploded in popularity. This scam can effect any gift cards that physically have public access to them like stands in a brick-n-mortar store. Gift cards that are virtual or the general public can not physically get to (such as staying in a warehouse and being included with a shipment) are not effected.

 

Personally I am skipping the gift cards for gifts and just using a personal check or cash now.

 

 

[WildDagwood]

Probably different at various stores, but at one I worked at years back we had two different processes for buying new and reloading cards. Basically, there was a dedicated reload option for already activated cards and the "normal", purchasing way wouldn't complete the transaction if a card had already been activated/loaded previously.

 

I expect many to adopt similar systems if they haven't already.

 

Edit: Took a minute to watch again (and more of it this time) because my attention was divided and misconstrued some things. The above doesn't solve the documenting of GC info, obviously, and I'm assuming they're using a script of some kind to check the numbers they've documented or it would be a pain in the ass to execute.

 

Don't you typically need to scratch the back off to see the PIN though? Replacing the glue for the packaging seems easy enough, but the scratch portion on the back seems like it wouldn't be as easy to replace (could be wrong, I have no idea). From my experience, the PIN needs to be manually entered, regardless of scanning or swiping, nor is it displayed as part of the regular barcode. I don't buy GC's often, but that seemed to be the case for the ones I recall, though it could be different for other GC's.

[Spotty]

For people who don't want to watch the video;

People are stealing the blank cards from stores and grabbing the card details or cloning the magnetic stripe before replacing the sticker back over the security code and returning the cards to the store. When somebody buys the card and loads a balance on to the card the scammers are using the card details they stole to extract the money from the card. The scammers are using the gift card website to check the balance of the card and using that to discover when a card has been activated and a balance loaded on to it and stealing the balance off the card before the card recipient has a chance to use the card.

 

It's an interesting scam. I wonder if they're reselling the stolen cards at discounted values, if they're buying goods with the cards then reselling those goods, or if they have some other way to extract the value from the gift card.

I never understood why people give each other gift cards. It's a worse form of money that can only be used in one store that often expires.

[Poinkachu]

51 minutes ago, Spotty said:

For people who don't want to watch the video;

People are stealing the blank cards from stores and grabbing the card details or cloning the magnetic stripe before replacing the sticker back over the security code and returning the cards to the store. When somebody buys the card and loads a balance on to the card the scammers are using the card details they stole to extract the money from the card. The scammers are using the gift card website to check the balance of the card and using that to discover when a card has been activated and a balance loaded on to it and stealing the balance off the card before the card recipient has a chance to use the card.

 

It's an interesting scam. I wonder if they're reselling the stolen cards at discounted values, if they're buying goods with the cards then reselling those goods, or if they have some other way to extract the value from the gift card.

I never understood why people give each other gift cards. It's a worse form of money that can only be used in one store that often expires.

Probably like CC theft.

Either sell it at a discounted price in black / grey market offline/online.

Or buy something using it online and send it to a fake home / highest bidder.

[wanderingfool2]

1 hour ago, Spotty said:

It's an interesting scam. I wonder if they're reselling the stolen cards at discounted values, if they're buying goods with the cards then reselling those goods, or if they have some other way to extract the value from the gift card.

Things might have changed, but at least in the recent years they were going onto crypto exchange websites and yea selling them at a discount.  From there they change the crypto to like another crypto (or another exchange) and then cash themselves out.  It effectively makes it a lot harder to track people with the rise of crypto currencies.

 

1 hour ago, Spotty said:

I never understood why people give each other gift cards. It's a worse form of money that can only be used in one store that often expires.

Under US law though, it expires at minimum of 5 years.  In Canadian law there is no expiry (which actually I disagree with), someone with a $0.50 balance shouldn't really be allowed keeping it around for 20 - 30 years.

 

Anyways, you give gift cards because it's the thought that counts...also many places give a discount if you purchase gift cards for people around this time...so I sometimes actually buy myself a gift card (get like $10 off when purchasing a $50 gift card).  As a kid, I would always be happy getting money but also getting a gift card to a place I liked was better.  Not only did it show the thought that they knew to buy it from there, but it also let me buy something from there (vs cash it would be "save some" or feeling more guilty about spending it on something more frivolous)

 

 

 

To this topic, there are more and more gift cards that come with a tear here backing on the cardboard.  Those essentially stop what is happening unless they have replacements for those.  It's actually really nice having those types of gift cards because you don't have to worry about as much about them being tampered with.  The only thing that is accessible is the barcode which is used to activate it...from there you can't access the rest of it without some form of destruction (and it's a lot harder to get your hands on the cardboard ones than the scratch off stickers)

[Mark Kaine]

On 12/15/2023 at 3:48 PM, Spotty said:

For people who don't want to watch the video;

People are stealing the blank cards from stores and grabbing the card details or cloning the magnetic stripe before replacing the sticker back over the security code and returning the cards to the store. When somebody buys the card and loads a balance on to the card the scammers are using the card details they stole to extract the money from the card. The scammers are using the gift card website to check the balance of the card and using that to discover when a card has been activated and a balance loaded on to it and stealing the balance off the card before the card recipient has a chance to use the card.

 

It's an interesting scam. I wonder if they're reselling the stolen cards at discounted values, if they're buying goods with the cards then reselling those goods, or if they have some other way to extract the value from the gift card.

I never understood why people give each other gift cards. It's a worse form of money that can only be used in one store that often expires.

mmm, interesting but i don't think this would work with eg. steam cards?

 

they need to be activated- the seal over the code should be nigh impossible to redo- and what if -how do they get money from me when im using my freshly activated steam wallet/gift card anyway ?

 

what "information"?

 

serious question,  either this is fake news, or there are other, more unsafe ways gift cards can work? 

[Brookz]

On 12/15/2023 at 1:51 AM, DJRWolf said:

Saw this video of a dangerous gift card scam that has been around for a few years but recently has exploded in popularity. This scam can effect any gift cards that physically have public access to them like stands in a brick-n-mortar store. Gift cards that are virtual or the general public can not physically get to (such as staying in a warehouse and being included with a shipment) are not effected.

 

Personally I am skipping the gift cards for gifts and just using a personal check or cash now.

 

 

Been avoiding gift cards for a while, now even less desire to use those...

[DJRWolf]

On 12/21/2023 at 11:36 PM, Mark Kaine said:

mmm, interesting but i don't think this would work with eg. steam cards?

 

they need to be activated- the seal over the code should be nigh impossible to redo- and what if -how do they get money from me when im using my freshly activated steam wallet/gift card anyway ?

 

what "information"?

 

serious question,  either this is fake news, or there are other, more unsafe ways gift cards can work? 

Ask yourself why are there bot farms that get a lot of cards from junk asset flip games that then grind them down into gems to then buy cards with value and flip them for money. I have seen videos from SidAlpha talking about that but would take me a long time to dig one up that specifically has it.

 

Another option is to buy a lot of hot games as gifts and sell them on a grey market at a discounted price. Since the Steam gift card money was stolen it is pure profit.

 

Also these people are taking the cards to a workshop where if they can reapply the seal over the code. If a few of them do not reapply correctly it is not really a major loss for them as they never paid to active it.

[Mark Kaine]

41 minutes ago, DJRWolf said:

Ask yourself why are there bot farms that get a lot of cards from junk asset flip games that then grind them down into gems to then buy cards with value and flip them for money. I have seen videos from SidAlpha talking about that but would take me a long time to dig one up that specifically has it.

 

Another option is to buy a lot of hot games as gifts and sell them on a grey market at a discounted price. Since the Steam gift card money was stolen it is pure profit.

 

Also these people are taking the cards to a workshop where if they can reapply the seal over the code. If a few of them do not reapply correctly it is not really a major loss for them as they never paid to active it.

that doesn't answer my question  - how do you do any of that with a non-activated steam card that you just stole from some shop - its literally not usable,  so i don't see how that's supposed work  

[Spotty]

1 minute ago, Mark Kaine said:

that doesn't answer my question  - how do you do any of that with a non-activated steam card that you just stole from some shop - its literally not usable,  so i don't see how that's supposed work  

They steal the card details from the unactivated card and then return the cards to the store. They put the card back on the rack of gift cards until it is purchased by a customer. The customer loads credit on to the card. The scammers are using the stores website to check the balance on the card and when they detect a balance has been put on the card they use the details they stole to purchase items with the gift card. When the customer goes to use the card the funds have already been drained from the account.

 

1. Steal gift card
2. Copy the card details
3. Return the card to the store and place it back on the shelf
4. Customer (victim) buys card and loads credit on card
5. Scammer detects the card has been activated by a balance showing on the website for that card number
   • Probably using some bot that automatically runs through thousands of cards on the store website periodically checking when they've been activated and alerting the scammer when ones been activated, or doing it themselves manually
6. Scammer uses the card details they stole to purchase items draining the funds from the card
7. Days or weeks later the customer (or recipient of the gift card from the customer) goes to use the gift card and finds that it has $0 left on the card
8. Scammer flips the stuff they bought to convert it to cash

 

On 12/22/2023 at 4:36 PM, Mark Kaine said:

the seal over the code should be nigh impossible to redo-

Not really. In most gift cards I've seen it's just one of those black & silver scratch off stickers. You could either cleanly remove the sticker with a razor and enough care to reveal the code and then reapply the same sticker, or if it's a more sophisticated operation they may have the stickers (or a similar enough copy) and just reapply a fresh scratch off sticker over the code. It just needs to be convincing enough that the worker and customer doesn't notice anything suspicious, and most people aren't going to be scrutinising the scratch off security sticker for signs of tampering - especially during holiday periods when stores are really busy.

[wanderingfool2]

1 hour ago, Spotty said:

if it's a more sophisticated operation they may have the stickers (or a similar enough copy)

I'm not even sure it's the more sophisticated operation that uses this approach.  To properly peel those security stickers would take a lot more skill and time than just slapping in one time peel sticker or security sticker into amazon.

 

Honestly though, the gift card makers need to start using the design where it's impossible to tamper with without destroying the paper container they are in...it probably doesn't cost too much more but would reduce the scams by a whole lot (except for the ones where the person from the factory is skimming the numbers...but at least those people are more traceable)

[Mark Kaine]

2 hours ago, Spotty said:

They steal the card details from the unactivated card and then return the cards to the store. They put the card back on the rack of gift cards until it is purchased by a customer. The customer loads credit on to the card. The scammers are using the stores website to check the balance on the card and when they detect a balance has been put on the card they use the details they stole to purchase items with the gift card. When the customer goes to use the card the funds have already been drained from the account.

 

ok, that *is* an explanation, but i doubt this would work with steam cards specifically, especially the bolded - why would steam do that, it doesn't make sense, it would be open season for scammers (in the way you describe) and that's beside they obviously couldn't sell the "stuff" aka games later on for cash... like i don't doubt this may be happening with some gift card types but that's why i specifically asked about steam... i think that system is a lot more secure,  we would hear more about it too (probably) if that was really an issue.

 

still if this is happening it all hinges on the information being publicly (?) available on the website,  which is baffling?

[Spotty]

3 minutes ago, Mark Kaine said:

ok, that *is* an explanation, but i doubt this would work with steam cards specifically, especially the bolded - why would steam do that, it doesn't make sense, it would be open season for scammers (in the way you describe) and that's beside they obviously couldn't sell the "stuff" aka games later on for cash... like i don't doubt this may be happening with some gift card types but that's why i specifically asked about steam... i think that system is a lot more secure,  we would hear more about it too (probably) if that was really an issue.

Well, I'm not sure if they're doing it with Steam gift cards. The news reports were for gift cards for major retail stores (Target, Walmart, etc).

You could in theory still do it with Steam, Epic Games, iTunes, etc by selling the gift cards. Sell a $50 value gift card to somebody for $30-$40. Problem with doing it that way is the person who buys the card has to spend it before the victim. But I'm not sure if Steam/Epic has a way to easily check account balances without redeeming it.

 

4 minutes ago, Mark Kaine said:

still if this is happening it all hinges on the information being publicly (?) available on the website,  which is baffling?

Some stores have the ability to check the balance remaining on a gift card by putting the card number on to their website. It's so people can see how much money is left on the card. For example if they had a $100 gift card, used *some* of the value on the card, then wanted to check how much was left later on. Most websites it's just a page where you put in the card number and pin and it gives you the balance.

 

https://www.target.com/guest/gift-card-balance

https://www.walmart.com/account/giftcards/balance
https://secure.store.apple.com/shop/giftcard/balance

 

If you've worked retail you know how annoying it is when customers bring in gift cards and say "I'm not sure if there's anything left on these" and you have to check the balance on a dozen gift cards that have an average of $0.12 left on them. When I worked retail when I was younger the gift cards we sold didn't have a way to check the balance online so I would use a sharpie to write the new remaining balance on the back of the card for people after they used the gift card.

[Mark Kaine]

1 hour ago, Spotty said:

. It's so people can see how much money is left on the card.

yeah, that system is of course inherently unsecure... theoretically that information should be stored on the card, but that would be a lot more (a few pennies probably lol) expensive for those stores..  so yeah, i don't doubt this is happening,  its 100% on the stores selling these types of gift cards tho.

 

sure theoretically possible with steam too, it's just not happening a lot i bet since it's a lot more difficult too (and can also be traced better as in where the card was activated and where the money was spent, etc)

 

personally i always found these "wallmart types" gift cards sus... and now i know why.