SPRINGFIELD – Gift card fraud is a growing threat across the United States, as criminal networks steal, tamper with and drain gift cards to launder money and finance further illegal activities.
The Illinois Organized Retail Crime Association (ILORCA) is sounding the alarm, urging consumers and businesses to stay vigilant this holiday season.
Gift card fraud has grown increasingly sophisticated, with organized criminal groups using a variety of tactics. Common methods include tampering with cards, hacking online accounts, and scamming victims into providing redemption codes.
Stolen funds are often used to buy goods for resale, helping finance criminal operations. These thefts could be particularly devastating for families stretching their budgets during this time of economic uncertainty and inflation.
“This time of year, people are spending more money and may be especially busy and distracted as the holidays approach, making our communities vulnerable to crimes like gift card fraud,” said Anne Sagins, executive director of ILORCA. “We’re urging consumers to check gift cards carefully for any signs of tampering, so their gifts reach loved ones as intended.”
ILORCA points to HSI’s warning signs that a gift card has been tampered with:
–Packaging shows tears, cuts, or resealing.
–Pull tab appears damaged, lifted, or previously opened.
–Logos, colors, or branding look slightly off or inconsistent.
–PIN sticker is missing, scratched, wrinkled, or uneven.
–Packaging or PIN cover looks different from other cards on the shelf.
–The card balance doesn’t match the amount paid.
To spread awareness, ILORCA hosted a virtual briefing for retailers and law enforcement. The session provided insights from the Department of Homeland Security about how these criminal schemes operate and offered strategies to help businesses detect and prevent gift card-related fraud.
Homeland Security Investigations (HSI) implemented Project Red Hook, a groundbreaking initiative that became federal law enforcement’s longest running and most successful operation against organized retail crime.
Consumers should report these crimes to the gift card company, local law enforcement and the Federal Trade Commission. HSI also has resources for businesses about gift card fraud prevention and information about reporting the crimes.
More information about ILORCA can be found on www.ILORCA.org.
