Like many consumers, Mei Mei Giang of California has a whole collection of unused gift cards sitting in a drawer. But when she recently tried using one of them -- a gift card she’d received a couple of Christmases ago – Mei Mei got a shock. The $100 card wouldn’t work, even though it had not expired.
Read Mei Mei’s original letter to the ABC News Fixer below, and see how The Fixer helped get her gift card unlocked. And check out The Fixer’s tips for preventing scams that target unused gift cards.
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Dear ABC News Fixer: I’m unable to redeem my $100 Bloomingdale’s gift card. I tried to use it online and it was denied, so I went to a brick-and-mortar store. The card wouldn’t work there, either.
The store employees helped us call customer service, who told us the card was “archived” because it was “dormant.” I had received the card as a gift about two years ago.
We waited 40 minutes while they tried to straighten this out; then we were told we’d have to fill out a form and the company would have to conduct an investigation and get back to us.
The customer service agent said dormant cards are archived after a period of time because of high incidences of fraud. I understand the concern about fraud but I had the gift card in my possession, still in the gift card sleeve, and the card does not have an expiration date.
–––Mei Mei Giang, Rancho Palos Verdes, Calif.
Dear Mei Mei: By the time you contacted the ABC News Fixer, you said you were so frustrated, you wondered whether this battle was worth it. But this had become something larger; now it was the principle of the matter.
We dug into this and also consulted with a cyber security expert from Kroll Inc., the corporate investigations firm. The big lesson: Everyone should hurry up and use their gift cards!
Gift card scammers continue to keep up with technology meant to protect us, says Alan Brill, senior managing director of cyber security and investigations at Kroll and an expert in gift card fraud. The holidays are prime-time for these thieves to make money.
When gift cards are sold out in the open on a rack, thieves can take a handful of them home or sneak them into a store bathroom, taking photos with their phones and copying the magnetic strip’s information with a skimmer. And those scratch-off PIN labels? Brill showed The Fixer replacement scratch-off stickers for sale online that he says are used by scammers to re-cover PINs they have looked at.
“They just put it [the sticker] on the card, and as far as you can see, it’s never been touched. And the bad guys can buy these from any number of sources in the hundreds or thousands for literally pennies apiece. And if you think about it, that’s a pretty good investment on their part, because that few cents for that sticker could turn into 50 or a hundred dollars. And the chance of being caught is really low,” Brill says.
Armed with the cards’ information, the scammer can place the cards back on the rack where consumers will buy them and add value at the register. The scammer can then monitor the cards online to see when money has been added – and then quickly use or resell them.
Brill says scammers love the period around the new year, because people have bought lots of cards over the holidays but recipients don’t use them right away.
It’s a pretty Grinchy way to ring in the new year, he says: “This is, for the bad guys who specialize in this kind of fraud, the happiest time of the year.”
Do you have a consumer problem? The ABC News Fixer may be able to help. Click here to submit your problem online. Letters are edited for length and clarity.
As for your card, you said the Bloomingdale’s representatives told you that your old, unused card had been essentially frozen to make sure it wouldn’t be targeted by such fraudsters.
We found similar stories online from consumers with some older Macy’s or Bloomingdale’s gift cards, who complained that they couldn’t access their money right away.
After we took your complaint to the company and explained that you were not a scammer, they quickly freed up the $100 on the card – and gave you an extra $50 to make up for the hassle.
A spokeswoman for Macy’s Inc., which owns Bloomingdale’s, declined to give specific details about the archiving of older gift cards, but said: “Customer security is of paramount importance to Macy’s and Bloomingdale’s. We actively monitor for fraudulent uses of our brand identity and branded gift cards on an ongoing basis. We take appropriate administrative and technical actions when we identify potential misuse or abuse of our brand and gift cards.”
The U.S. gift card market is huge, with around $27 billion projected sold just during the winter holidays, according to the National Retail Federation. Almost $1 billion in gift cards goes unused each year, according to a 2015 estimate by the business advisory company CEB Tower Group.
Federal law protects consumers by regulating expiration dates and fees for retail gift cards, and some states offer further protections.
But to avoid problems, here are some tips:
–Don’t let gift cards sit around, getting lost or hacked. Use them!
–If the card offers an online registration, do that now. And check the balance while you’re at it.
–When giving a gift card, enclose the receipt. If it’s lost or stolen, the recipient will have an easier time getting help.
–Buy only from trusted sources.
–Examine the card before you buy it. Make sure the gift card packaging hasn’t been tampered with, and the PIN covering hasn’t been scratched off and replaced. Even better, buy gift cards that are sold behind a register.
-The ABC News Fixer
Do you have a consumer problem? Contact The ABC News Fixer at ABCNews.com/fixer. Letters are edited for length and clarity.