Stolen Credit Cards Being Used To Buy Gift Cards
According to an ABC News report, thieves use a stolen credit card number to buy a gift card online, and then sell it to the highest bidder at an online auction Web site or for a set discount at a gift-card exchange Web site.
The ruse helps crooks make use of pilfered credit card numbers before the victim has a chance to deactivate the account. The scam extends the life of credit card fraud, experts said.
Precise measures of the scam are tough to pin down. But gift cards have become a multibillion-dollar enterprise. Banks and retailers will issue a record $97 billion of them this year, up from about $82 billion last year, reported the TowerGroup.
Since late 2002, merchant- and bank-issued gift cards have been increasingly turning up for resale on eBay, Craigslist and card-exchange sites such as cardavenue.com, plasticjungle.com and swapagift.com.
eBay listed 3,400 for resale at the time the report was made. To stem fraud, eBay in 2003 began limiting sellers to offering one $500 or less gift card per week. But experts maintained that policy is routinely violated.