Yet Another Scam

Longtime readers might remember references to Cousin Kim. She’s Derek’s cousin by DNA but I’ve definitely claimed her too! With permission of her daughter, Kristina, I’m sharing their story today. It’s a scam I’d never heard of but it’s more common than we might think. A frustrated Kristina told her story on the Mastercard Facebook page:

Apparently some savvy thieves steal the magnetic info from the card and use it. It’s not clear how, although I’m told it’s as easy as walking past the card rack with the proper equipment. A trace showed that the card was redeemed at a Toronto Walmart. That didn’t raise red flags for Mastercard or Walmart, leading to denials of Kristina’s fraud claim.

I found very few references to prepaid card scams of this nature. Usually, they involve cutting open the card package, which is so obvious, few people would miss it. However, I did find this info on a site devoted to comparison shopping for credit cards:

In a classic gift card scam, a thief checks gift cards displayed in a store and writes down identifying information or lifts it from the card’s magnetic stripe using a scanner. The crook then goes home and repeatedly checks online to see when the card is activated (usually this is done when the cashier rings up the purchase of the card). Once activated, the thief spends the card balance online.

In another traditional scheme, a thief will apply a bar-code sticker over the genuine bar code of a gift card in a shop. When the sticker is scanned, it activates a blank card that the crook has stolen instead of the card the consumer is purchasing.

The fraudsters are always one step ahead of the good guys. Companies like Mastercard and Visa need to hire more “white hat” hackers to figure out how to accomplish and then prevent these types of scams earlier and faster. Otherwise, good people like Kim and Kristina will continue to pay the price.