Gift card draining uses 2005-era packaging that scammers defeat in seconds

Organized crime groups recruit 'takers' who steal unactivated gift cards from retail racks, 'tamperers' who slice open the card carrier with an X-ACTO knife to copy the card number and PIN, then reseal the packaging so it looks untouched, and 'placers' who return the compromised cards to stores -- often in high-traffic spots where they sell first. The consumer buys what looks like a sealed card, loads $50-500 onto it at checkout, and the scammer -- who has been polling the card number via balance-check APIs -- drains the balance within minutes. The victim discovers a zero balance when they try to use the card, often as a gift, creating both financial loss and social embarrassment. The FTC received over 41,000 reports in 2024 representing $212 million in gift card fraud losses. This persists because anti-tamper packaging on most gift cards has not materially changed since the mid-2000s: the zigzag perforations and scratch-off PINs are trivially defeatable, and retailers have had no legal mandate to upgrade packaging until Maryland's 2024 Gift Card Scams Prevention Act -- the first law of its kind in the entire country. Retailers resist packaging upgrades because the cost falls on them while fraud losses fall on consumers.