SPRINGFIELD – Gift card fraud is a growing threat across the United States, as criminal networks steal, tamper with, and drain gift cards to launder money and finance further illegal activities. The Illinois Organized Retail Crime Association (ILORCA) is sounding the alarm, urging consumers and businesses to stay vigilant this holiday season.
Gift card fraud has grown increasingly sophisticated, with organized criminal groups using a variety of tactics. Common methods include tampering with cards, hacking online accounts, and scamming victims into providing redemption codes. Stolen funds are often used to buy goods for resale, helping finance criminal operations. These thefts could be particularly devastating for families stretching their budgets during this time of economic uncertainty and inflation.
“This time of year, people are spending more money and may be especially busy and distracted as the holidays approach, making our communities vulnerable to crimes like gift card fraud,” said Anne Sagins, Executive Director of the Illinois Organized Retail Crime Association. “We’re urging consumers to check gift cards carefully for any signs of tampering so their gifts reach loved ones as intended.”
To spread awareness, ILORCA hosted a virtual briefing for retailers and law enforcement. The session provided insights from the Department of Homeland Security about how these criminal schemes operate and offered strategies to help businesses detect and prevent gift card-related fraud. Homeland Security Investigations (HSI) implemented Project Red Hook, a groundbreaking initiative that became federal law enforcement’s longest running and most successful operation against organized retail crime.
ILORCA points to HSI’s warning signs that a gift card has been tampered with:
- Packaging shows tears, cuts, or resealing.
- Pull tab appears damaged, lifted, or previously opened.
- Logos, colors, or branding look slightly off or inconsistent.
- PIN sticker is missing, scratched, wrinkled, or uneven.
- Packaging or PIN cover looks different from other cards on the shelf.
- The card balance doesn’t match the amount paid.
Consumers should report these crimes to the gift card company, local law enforcement, and the Federal Trade Commission. HSI also has resources for businesses about gift card fraud prevention and information about reporting the crimes.
More information about ILORCA can be found on www.ILORCA.org.
About the Illinois Organized Retail Crime Association
The Illinois Organized Retail Crime Association (ILORCA) was established as part of the Integrity, Notification, and Fairness in Online Retail Marketplaces for Consumers (INFORM Consumers) Act, one of the most comprehensive efforts in the nation to combat organized retail theft. Organized retail crime targets all types of businesses through complex, coordinated efforts by criminal groups with the goal of reselling stolen items to fund illicit activities. Funded through a grant from the Illinois Department of Commerce and Economic Opportunity, ILORCA administers and oversees a statewide intelligence-sharing platform for improved coordination between retailers, law enforcement agencies, loss prevention specialists, and other stakeholders to combat these criminal enterprises. More information can be found here: https://ilorca.org/