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Kroger Cracks Down on Money Orders
One popular way for many to generate spend is to purchase gift cards and then use those gift cards to purchase money orders. Those money orders can be deposited into a bank account and then that money used to pay off the credit card which was used to purchase the gift card. They call it the Circle of Life.
Ok, maybe I made that last part up, but it does seem to be an effective way for some to earn rewards. There is one huge issue with the whole cycle though. FRAUD! You see, what if those gift cards were purchased with a stolen credit card? Once they are turned into money orders then that money is much harder to trace. Those darn criminals ruin everything.
Via /u/ID4TgIOBi on Reddit, Kroger, the nation’s largest grocery chain is about to stop allowing the use of prepaid debit cards to purchase money orders. In the bulletin which can be seen here, Kroger says the following:
Effective the week of November 28th, we will no longer accept gift cards or temporary prepaid debit cards as payment for money orders.
Permanent reloadable prepaid debit cards (those that feature the customer’s name on the front) will still be accepted.
Why is this happening?
This is part of Kroger’s on-going fraud protection efforts.
Time frame: November 28 – December 2
Apparently the system will now be hard-coded to not accept these cards. I expect that even prepaid cards with your name on them such as those from GiftCards.com probably won’t work either, although we will have to wait to see how this is implemented to know for sure. It does seem like more permanent reloadable cards will continue to work.
My local Kroger chain is Smith’s and all of my closest locations stopped accepting gift cards for money orders quite awhile ago. The system would allow it, but all (and I mean all) of the employees were instructed on a district level to not allow this.
There are definitely other stores where you can purchase money orders so this won’t be the end of the practice, but for many who relied on Kroger this will hurt. Unfortunately fraud works against so much of what we do in the hobby and technology will only get better to stop it.
What are your thoughts? Did you rely heavily on Kroger to buy money orders or were you buying them somewhere else. Will this change have an effect on what you are doing to earn rewards? Let us know in the comments!
Jeff H on Twitter
Miles to Memories has partnered with CardRatings for our coverage of credit card products. Miles to Memories and CardRatings may receive a commission from card issuers.