Walmart stops scammers from receiving $4 million in gift cards

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Walmart’s technology helped it identify and freeze millions of gift cards purchased by elderly victims who had fallen prey to scammers, CNBC wrote on Monday (April 4).

The US Department of Justice recently seized the funds after being warned by the retail giant.

Now victims can get their money back.

Seizing fake gift cards is a boon to older Americans and others who had lost money in scams, if they knew they had lost any money at all.

CNBC wrote that the money Walmart has saved for these victims is a “small fraction” of the millions lost each year to various “impostor” scams that use gift card purchases. The amount of money from these scams has only increased in recent years – in the first nine months of 2021, consumers said they lost $148 million in scams where gift cards were used for pay crooks, according to data from the Federal Trade Commission.

In contrast, $114 million was lost to gift card scams in 2020.

Scams typically involve callers phoning victims, telling them they owe money for debt or needed services. Calls say victims should visit a retail store and purchase a gift card that can be used to pay off the alleged obligation.

The caller often says they are a government, utility, or private company representative, insisting on prompt payment.

PYMNTS wrote that in 2020 threats of organizational fraud increased during the holidays.

See also: Fraud threats from organizations increase this holiday season

The report notes that the then still somewhat new pandemic had caused an increase in e-commerce, and fraud with it — everything from chargeback fraud to online product scams.

Online shoppers were at risk, but threats of fraud spread throughout the supply chain, also putting businesses at risk, due to their then nascent shift to selling online.

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