April 19, 2024

Gallego Calls on Homeland Security, DOJ to Crackdown on Gift Card Fraud

WASHINGTON –Today, Rep. Ruben Gallego (AZ-03) sent a letter to Homeland Security Secretary Alejandro Mayorkas and Attorney General Merrick Garland calling on their departments to work with retailers to crackdown on gift card fraud schemes that have resulted in the theft of millions of dollars from innocent Americans, especially seniors.

These schemes operate by removing gift cards from a store, recording the card numbers and pins or replacing them with a barcode, repairing the packaging, returning the cards to the store, and then waiting for an unsuspecting customer to pick up the tampered card. Then, when money is added to the card, the criminals have access to the card balance remotely and can steal the entire balance.

“With the help of the federal government, retailers must do their part to crack down on this hub of illicit financial activity in their own backyards. Without the participation of retailers, innocent American consumers risk inadvertently financing criminal activity while having their bank accounts drained,” writes Rep. Gallego.

He also notes his concern that money from this fraud is being used to finance further illicit activity, including the narcotics trade, and that the disproportionate number of Chinese nationals arrested as part of these schemes could point to possible involvement by the Chinese Communist Party.

To that end, Rep. Gallego poses the following questions:

  • What resources are available to consumers who believe they may be victims of gift card fraud?
  • What steps have been taken to address gift card fraud?
  • Is there evidence of active participation of the Chinese Communist Party in card theft?
  • What anti-fraud measures have been recommended to retailers, and which retailers have agreed to take measures to cut down on fraud?
  • What additional resources or authorities do you need to combat gift card fraud?

“While transnational crime organizations are not a new phenomenon, they are constantly seeking new ways to get around law enforcement and hurt innocent people,” Rep. Gallego concludes. “We must remain vigilant.”

Full text of the letter can be found HERE.