WARNING: New Visa Gift Card Scam & How to Protect Yourself

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visa gift card scam

A New Type of Visa Gift Card Fraud

Hello everyone. I know the title is a little bit strong, but something happened to one of my readers the other day when buying a variable load Metabank gift card at a grocery store. I wanted to make sure to get your attention so you know what to look for and learn how best to protect yourself.

A Scary Story

Last night I received an email from Paul about a nightmare he had when purchasing a Metabank variable load Visa gift card at a local grocery store here in Las Vegas. He has been around this hobby for awhile and makes sure to check the packaging in case it has been tampered with.

After verifying the packaging was 100% in tact, he paid for his gift card and went to Walmart to liquidate it. At that point the card was denied and he noticed that four of the digits of the card number were scratched off. He also was eventually able to verify that the magnetic strip was cleaned of any data. The card was worthless and useless.

Here is what happened in his words:

So something happened to me today you might want to warn you readers about. I bought a 500.00 card today, I always make sure it has not been tampered with and the bar code is still covered. Well went to load it at Walmart and noticed 4 of the digits had been scratched off the card and the magnetic strip was wiped clean. It would not swipe of course. I went back to the store to show the manager and we proceeded to open that last 3 on the shelf and same thing with all of them.

visa gift card scam
This is the card. The number has not been altered in this image. It was missing when he opened the packaging.

So based on his experience, it seems likely that one of two things has happened with these cards:

  • The cards are being tampered with before leaving the factory
  • Someone is taking cards, altering them and then using counterfeit packaging to put them back on the shelves.

I really don’t know which of these scenarios is more plausible, but the fact remains that these tampered with cards were somehow completely sealed inside of the package with absolutely no tampering. Paul has made it clear that the packages did not have a rip, tear or any other opening.

visa gift card scam
This is not the exact package, but this is the same package type as what he purchased.

How to Protect Yourself

The manager told Paul how best to protect himself and I think it is a good strategy. If you are purchasing these cards bring them up to the register like you normally would. After the cashier scans them (but before you swipe your credit card), make sure to take the card out of the package and inspect it. That way you can verify the card hasn’t been altered.

I’m not going to lie and say that every cashier will be happy with you trying to do this, but perhaps you can explain the situation. If you bring the cards up to the cashier already opened, then they will suspect you of doing something. Always make sure to open them after they are scanned, but before you swipe your credit card.

Conclusion

This is a really scary type of fraud, because it is nearly impossible to see beforehand. How they are getting these tampered cards into the packages is beyond me, but I know I will be extra careful when purchasing these cards in the future. While Paul will be able to get his money back because he caught the fraud right away, it will be a hassle I’m sure. Oh and how many people don’t check these cards right away? A lot I’m sure.

If you have encountered anything similar to this please let us know in the comments.


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28 COMMENTS

  1. Crazy. Thanks for passing along. Great tip, but it seems like a pain to open them during the transaction. Do you think you’ll actually do that, or just deal with it if/when this happens to you? Has there been a conclusion to Paul’s story? Did he get his $500 back? (I assume yes, given the other bad cards he and the manager found at the store.)

  2. I had this happened to me at a local grocery store. After I had removed the card from the package, the last 4 digits were scratched off. I inspected the packaging and it does not look like it was tempered with. I called the # on the back of the card right away and the agent on the phone was able to close this card and send me a new one in the mail. Now everytime I buy cards from that grocery store, I would request to have the card opened first before I purchase it.

  3. I had something similar happen to me with a $500 GC I purchased at a grocery store back in January. My case is still open and I haven’t gotten all my money back. I have since stopped buying GCs at grocery stores. I found it useful to keep up with this flyertalk thread, which is devoted entirely to gift card fraud: http://www.flyertalk.com/forum/manufactured-spending/1588993-gift-card-fraud.html

    Traveling with Grant also had a useful post about a similar GC fraud from February of this year: http://travelwithgrant.boardingarea.com/2015/02/08/gift-card-warning-check-packaging-for-signs-of-tampering/

  4. Happened to me in March, still waiting for a refund. Had to fax copy of card and receipt. Then was sent an affidavit to fill out, which also required filing a police report since someone unloaded the balance at a Walmart. My solution is to not buy these insecure cards, it is a known problem to them. Now I just stick to Staples and Simon Malls.

    • I got an affidavit to fill out, but I did not report to police when someone drained money out at Walmart and CVS. Can I report to police now after one month happened?

  5. While purchasing a “dud” would be terrible, what worries me is if these scheme propagate or become too difficult to stop, visa will stop offering cards – or make a two step verification process or something which would lead to extra steps, add hassle, and possibly a loss of anonymity. “Hey Chris, that’s you for your 20th verification this week, we’ve let the irs know that you’ve done nothing illegal but you sure do process a lot of money. “. Not that there is anything to hide but I would quit before being required to deal with the irs.

    • I’m equally worried about the Secret Service and their itchy trigger fingers when it comes to civil forfeiture.

  6. I purchased 2 $200 Mastercards at Staples on 3/23. I didn’t unload one until late April. At the end of May I checked the balance on the other and there was only $4.45 on it. The fraudulent purchases occurred on 5/25 and 5/28. Lesson learned, if I can’t unload it quick I will register it. I’m just assuming that would help. I never had luck at Walmart with these cards, that’s why I had them floating around so long. The packaging seemed fine to me and the card looks ok.

  7. Today at the grocery store over half of $500 VGS on display had their pin code strips torn off. I finally found an intact one and it worked fine.

  8. Just bought one this afternoon got home opened it the middle numbers were missing. Went back to the grocery store and they said can’t help me from the store level but they did call the gift card 1800 number and explained the whole situation. The help desk for the gift card said the money was there in the card and they will gladly send me a replacement card.

  9. Love how this store begins in Las Vegas…

    At any rate, paying for the card after opening the package would obviously prevent this type of fraud from happening, however, this is introducing complexity into the transaction. Given that there definitely a double digit percentage of cashiers and managers who are uneasy about selling high value gift cards (and many of them) with credit card, you risk having additional eyes on the transaction, and ultimately being told ‘cash only’ or something along those lines (whether this is an actual store policy or not).

    Thad said, why did Paul wait so long to open the package after having purchased it?

    As habit, after paying I immediately bust open the package, inspect the card, make sure receipt matches bar code numbers, etc.

    If card has been altered (and clearly having the last 4 digits of the card scratched off is indication of altering), one can immediately call customer service on this, show it to the manager of the store, and more or less get this resolved then and there (or at least to the point where your funds are no longer in danger). It’s highly unlikely that the would be criminal could have the time to drain said card so soon after purchase.

    Waiting so long to check the card after purchase (or rather not checking it immediately after purchase) is a ‘head scratcher’… While Paul thankfully prevailed, it seems apparent that much of his profit was eaten in fuel (and time) in driving to WM, waiting in line not being to accomplish said BB load or what-have-you and then having to drive back to the grocery store again, without even considering how long one must wait for a refund…

    • You make a good point, but I would assert that most people don’t open the cards and check them right away. As you say though that is a prudent practice and one that everyone should partake in. On the flip side, once your transaction is completed with the store, if the card has been tampered with, you are still going to have a headache getting your money back. It isn’t possible for them to simply reverse the transaction so it still is a hassle. Thanks for sharing!

      • I found out that my gift had been compromised before I activated the GC. Luckily I was right next to the grocery store and went inside to speak to store manager. After several calls and almost 40 minutes of waiting, the manager was able to move the funds from VGC to MCGC. Store managers do have the ability to help.

  10. I doubt it would have helped in this case, but I would be totally okay with stores keeping the higher value cards behind the counter. My local Staples has stopped stocking $200 Visa & MC cards because torn strips/fraud (at least, that’s what they told me).

  11. I don’t understand how people benefit by stealing unactivated cards? Do they write the numbers down and then wait for them to be activated and buy things online with the number?

  12. Thanks for the heads up. I will check them immediately after purchase. Sounds like the best course of action is to immediately check the balance and ask for a replacement if there isn’t the proper balance on the card.

  13. Due diligence is also important if you get hit. I got my card at Walmart and immediately called when I got home as it wasn’t swiping.. somehow these suckers are also demagnetized.

    It took a long time to try to bypass the menu to get to an agent (considering it’s impossible to type in 4 missing digits) and so I submitted the paperwork and they said to expect a refund within 2weeks. Of course 2 weeks goes by, no check… and called in again. Turns out they closed the case as they found that there were 2 large charges made. Supposedly if they go through, they can dispute it.. if not, then it’s “supposed” to go back to my card. Part of me wants it to go through, so the retailers can reach into their systems and see where my goods are getting delivered to. Course, that means this will delay the refund process. =/

    Thank you, if it wasn’t for coming across this article a couple weeks ago.. wouldn’t have made the connection that this card was definitely tampered. The packaging wasn’t ripped or anything funny and I thought I scratched off the numbers myself.

  14. My daughter was a victim of the Walmart/Visa Gift Card Scam, She lost $150.00 at Walmart, she purchased the card and 3 days later when my granddaughter went to use it, nothing was on the card. Walmart and the company that supports the card Green Dot Inc, are refusing to refund the amount. There is video of the crook using the card at a ATM in a Walmart, I have the original card with packaging, I filed a claim through Green Dot Inc. , they denied the claim, stating it was a valid transaction, I filed a police report, filed a complaint with the local BBB. Walmart, Green Dot Inc. , and Visa refuse to investigate in good faith, none have contacted the Asset Protection Depts. at either Walmart, the police will not investigate because of the low dollar amount. I have spent several hours on the phone and at the Walmart where the card was purchased, each time I am told a different story of what to do. I have contacted two police depts., the company that issued the card, ( Green Dot Inc. ) two Walmart’s , Visa, and approx. 12 phone calls later, several visits , none will accept responsibility. This occurred in Long Beach, Ca.

  15. I am a victim of fraud also and it is not worth buying this gift cards. Ralph’s and other places that sell them should discontinue offering them due to this trouble. I’m sure there are many victims out there and the card issuer does not care because they are still making money. Avoid the pain and heartache and just don’t buy them period. Get something else as a gift.

  16. I am a victim of this hideous scam! I purchased $350.00 worth of Visa cards at Walmart in Tewksbury, MA. It is so humiliating to have you grandson call you and tell you when he went to use the Visa card to buy something, it had no money on it, and it was used by someone in California. I am trying to fight this crap now, with hopes that I will be able to replace the money on the cards. Incidentally the other 3 cards were comprimised too.

    • OMG, I had it happen to me. I bought a Visa at Walmart in Northern California and had $50 put on it. I gave it to my grandson for Christmas, he tried to use it and it only had $4 on it! I was furious. The packaging didn’t look tampered with. The assistant manager told me “it wasn’t their fault” but they did replace it with another card. My grandson used the card before we left the store so no one else could use it. I will never buy any type of gift card again:(

  17. Use a clean email account for your financial transactions and accounts, do not use that account for ANY other online activity.
    you will automatically know that all mail not coming to THAT account is not related to your real financial situation. scrutinize all mails coming to your special account and request ‘text-based’ mails whenever possible.

  18. I received a $7 Staples Meta bank rebate card in the mail back in November with a May 2017 expiration date. The card stayed in the house until I tried using it yesterday at Staples. The balance was zero. Got online. Two purchases for $1 online and $6 in Whittier CA on Feb 15th & 16th 2017. I’m in Michigan. Contacted Meta Bank. To file a fraud claim, one must print out a claim form, complete the form and have it notarized. Of course, it costs more for the notary public than the card is worth. They insisted that the process must be followed. Obviously, that is not going to happen. So, perfect scenario for massive under-the-radar fraud. I think retailers might what to reconsider using Meta bank as their provider, and the general public should not buy their cards.

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