Kroger VGC Fraud/Scam Is Worse Than We Thought – Very Elegant Plan
Yesterday I talked about reader Joe’s recent issue with some Visa gift cards that he purchased at Kroger during the 4x promo. Every card he purchased was drained and Kroger was unwilling to do anything about it. And that is after they admitted they knew there was an issue. They were even able to go to the gift card rack and find more fraudulent cards very easily. After talking with Joe some more, now I know why.
An Elegant Scam
I was surprised to hear that Joe’s gift cards were zeroed out as soon as he got home. Come to find out when he called in to the Visa gift card providers they said the cards were never activated. So of course they said go back to Kroger and get a refund since they were not activated. But Joe had receipts showing activation of the cards. Here is why the scam is so elegant.
The scammers are somehow opening the packages and putting in a printed barcode over the gift cards. So when the pull tab is removed they scan this paper bar code. That activates a card THEY have in THEIR possession. It does not correlate to the card that is actually in the package.
They are able to get the packages opened and resealed without raising suspicions. This is why I think it is an inside job.
How Do You Detect This Scam?
The best way to detect this scan is rip off the pull tab before taking them to a register. Run your finger along the bar code. If it is plastic feeling with bumps you should be good. If it feels like paper then take it to the service desk and alert management.
Conclusion
This is becoming a serious issue that neither the stores or gift card issuers seem to be taking seriously. The company that stocks the shelves needs to be tracking this info down because someone is taking them for a ride. The stores should also be training their employees on what to look for. I would not be surprised to see these pulled from the shelves soon in areas where this is prevalent (mainly the west coast right now).
By doing it this way there is no one willing to take blame. Kroger says they never take blame and the gift card company says that the cards he has were never loaded. I told him to call them back and explain the scam and give them the paper bar code info to see if they can resend him those gift cards.
Be careful out there people!
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Another DP in Atlanta but for a $500 variable VGC, and was not able to get our money back from Kroger. Exploring other avenues now…
I would call the gift card issuer and ask for a replacement and if that doesn’t work file a chargeback.
Hi AL. I’m a reporter in Atlanta working on this story. We talk with a family this happened to as well. Can you reach out to me so that I can hear your full story, too?
Thanks,
Dana Fowle
dana.fowle@foxtv.com
I just encountered this elaborate scam at a Kroger in Atlanta. Bought a $100 VGC yesterday, got home and discovered that it had the paper barcode that was scanned and activated, but the actual card in the package was turned around with its own activation barcode. Went back today and spent 30 minutes with management, and got my money back. While I was waiting, the employees started pulling all of the VGCs off the rack and inspecting them, and found over 20 similar fraud packages, not only of the $100 variety, but some of the variable $20-$500 variety. Kinda scary, but glad I know what to look for now and glad it didn’t happen on 3x$500 variable VGCs.
So it is spreading – not good. I am glad you were able to get a refund on it though.
Fred, as I said above, I’m a reporter in Atlanta working on this story. We talk with a family this happened to as well. Can you reach out to me so that I can hear your full story, too?
Thanks,
Dana Fowle
dana.fowle@foxtv.com
Reply
Thanks, Mark,
I’m always checking, as I had 4 fraudulent MC gc’s 2 years ago. Thanks for the heads-up on how to check these gc’s lately. If there is a problem, you really have to catch it early.
Thank you,
Karen
Glad I could help Karen 🙂
hi, Mark! do you know what to do after your money has already been stolen? I just found out yesterday that one of my $500 VGC has depleted by some fraudulent back in Feb, I brought this card 1 year ago, just always forget to use it since then, after reading your post, I checked the balance…….I know for my case it maybe impossible to get anything back, but how to protect yourself in general?
Yeah after a year I don’t think you would have much recourse. Usually you contact the gift card issuer and they will send a replacement if you catch it early enough. A charge back with your credit card company is another option but not always a sure thing.
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For metas I buy at the grocery stores and everywhere GCs from OSS, I make sure the barcode scanned by cashier matches the barcode printed on the receipt before I leave the store. So far, so good.
Mimi, op / buyer likely checked it whereby the #s matched & card is activated, but in this case the barcode was a fake or fraud
Mark I just had the same thing happen to me with an unopened Shell gift card I tried to use in Colorado Springs on vacation. When I gave it to the clerks, I still had my receipt from Publix stapled to it from the store in Florida. Shell said the card was used previously. Both clerks attested to the fact that they opened the package and tried to use it in the machine to pay for gas. When I called Shell to report this, standing there in the store with the clerks present, they said tough luck.
That is the first I have heard of gas cards getting tampered with. It would seem so hard to do since you need the actual gift card to do everything. Interesting. Did they say where it was used or confirm that it was actually properly loaded?
The city went through a recall of Racetrac cards a couple years ago, at which time shell started sealing theirs with a cashier tear off strip, over the barcode. What people were doing was somehow copying the numbers and evidently generating copies. Cards are especially popular with purchase of $50. groceries, $10 off $50 card.
Interesting – thanks for the info Jack
I’m glad to see this is finally being talked about. I had this happen to me sometime in February. Also make sure the barcode numbers match the numbers printed on the back of the packaging.
Good point Phil…that is another good way to check for tampering.
Added DP. This isn’t just happening at Kroger’s. My same situation occurred at a Walgreens. Be safe out there.
Yikes – this has to be happening at the GC providers place before they go out.
I believe they steal the gift cards off the shelf, modify them at home, then replace back on the shelf waiting for the victim to purchase. I bought gift cards that had been re glued from Vons and CVS near me. They’re very good at sealing them back up.
That could be true. I just think with how wide spread this is it is coming from the supplier this way. I could be wrong on that but it is my gut feeling.
Checking serial numbers isn’t sufficient. The smarter fraudsters demagnetize the cards. By the time you try and use the gcs and find out nothing happens, it’s often too late. If you’re paranoid, buy a cheap debit card reader dongle (like the Square Reader for $9.99 on Amazon) for your phone and swipe to check the mag strip can be read before you leave the store (or when you’re in the parking lot).
Sadly, I know way too much about these scams (and how to perpetrate them).
Maybe a little water would do the trick! Ink printed on plastic won’t smear or smudge or bubble when a drop of water is applied.
Problem with tearing open the back before getting to the cash register is cashiers are told to look for that kind of tampering.
If you open the card in front of the cashier and check at the register, this should avoid the “tampering” problem.
correct, at the cash register before paying, of course
I think you can peel the tab without an issue – at least I have in the past.
Nice find.
Thanks Debit
Mark, thx for addl post / detail about the recent GCs fraud at kroger; i always tore open the entire back to examine the card (bar code & magnetic strip) except for the cards that are given as gift which was not many, lol
That is a good idea these days.