Gift card fraud prevention: How retailers can spot scams, strengthen controls, and protect revenue
Guest: Jarrod Price
Gift card fraud is one of those problems that never really stays small for long. For a lot of retailers, it is a constant issue. And when outside conditions shift, whether that is payment pressure, scam trends, or criminals looking for easier ways to move value, gift cards tend to become even more attractive.
That is exactly why I wanted to have this conversation with Jarrod Price from InComm Payments. In this episode, we dig into gift card fraud prevention from a practical angle, not just what the scams are, but how retailers, fraud teams, and anyone responsible for payment risk can understand the specific patterns affecting their business and respond more effectively.
We talk about some of the most common gift card scams, both online and in-store, why anonymous or easily transferable value keeps drawing fraudsters back to this category, and what teams should be looking at when they are trying to assess whether their current process, technology, or fraud risk stack is actually doing the job.
And that matters.
Because gift card fraud prevention is not just about blocking one bad purchase. It is about understanding how fraudsters exploit speed, anonymity, resale value, and operational gaps, and then building a smarter response around the real problem instead of the most visible symptom.
Why this topic matters
- Gift card fraud affects retailers, fraud teams, store teams, ecommerce teams, payment providers, and consumers who get caught in scams
- Gift cards remain attractive to criminals because they can move value quickly and often with less traceability
- Online gift card fraud and in-store gift card fraud can look different, but they often exploit the same underlying weaknesses
- Better gift card fraud prevention helps reduce direct losses, customer harm, and operational strain across the business
What you’ll hear in this episode:
- Some of the most common methods used in gift card scams online and in-store
- How to understand your company’s specific gift card fraud problems instead of relying on generic assumptions
- What gift card fraud detection and fraud process assessment should look like in practice
- How to evaluate whether your current controls, tools, or fraud risk stack are actually effective
- When it may be time to increase resources, tighten controls, or add more support to your risk strategy
You should listen to this episode if you:
- Work in retail, ecommerce, fraud, risk, payments, or store operations and want a stronger approach to gift card fraud prevention
- Need better visibility into gift card scams, gift card scam trends, or retailer payment fraud
- Want practical insight into online gift card fraud, in-store gift card fraud, or gift card abuse prevention
- Are reviewing your fraud controls for gift cards, fraud process assessment, or overall fraud risk stack
- Care about gift card risk management and stronger retailer fraud strategy
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Episode notes & key takeaways
Why gift card fraud keeps coming back
Let’s break this down.
Gift card fraud keeps staying relevant for a reason. Gift cards are easy to understand, easy to move, and often easy to monetize. That combination makes them useful not just for one type of fraudster, but for a whole range of abuse patterns, from direct fraud to scams that pressure consumers into buying cards and handing the value over.
That is what makes this category so persistent.
A lot of payment instruments come with more friction, more traceability, or more recovery options. Gift cards often do not. Once the value is purchased, transferred, redeemed, or resold, the chances of recovering it can drop fast. That usually does not leave much room for error.
And that matters for more than retailers.
Consumers get hurt in gift card scams all the time. Store employees get put in difficult situations. Fraud teams get left trying to distinguish between direct fraud, scam activity, and post-purchase loss after the value has already moved.
- Gift card scams stay attractive because gift cards are portable, fast, and relatively easy to convert into usable value
- Anonymous payment fraud often becomes more appealing when criminals want less traceable ways to move money
- Gift card risk management has to account for both direct fraud and consumer-targeted scam pressure
- Gift card fraud prevention matters because the harm can reach retailers and consumers at the same time
How online and in-store gift card fraud differ
Here’s what’s actually happening.
One mistake teams sometimes make is treating all gift card fraud like one uniform problem. It is not. Online gift card fraud and in-store gift card fraud often overlap, but they do not always look the same operationally.
Online gift card fraud may show up through stolen payment methods, account compromise, automated purchasing, resale activity, or patterns designed to extract digital value quickly before anyone has time to respond. In-store gift card fraud may involve scam victims purchasing cards under pressure, suspicious bulk behavior, tampering, or social engineering that plays out right in front of employees.
Those are different environments.
But the reason they both matter is that the same core attributes, speed, transferability, and usable stored value, make gift cards appealing in both channels. So if a retailer is only looking at one side of the issue, the picture is probably incomplete.
- Online gift card fraud often moves fast and can be tied to stolen payment activity or account abuse
- In-store gift card fraud often overlaps with scam victimization and employee-facing social engineering
- Gift card abuse prevention works better when retailers compare cross-channel patterns instead of treating channels in isolation
- Retailer fraud strategy needs to account for the fact that the same product can be abused very differently depending on the channel
Why your specific gift card problem matters more than generic advice
This is where things get interesting.
A lot of companies want a standard set of gift card fraud best practices they can drop into place and call it done. I understand the instinct. But the truth is, gift card fraud prevention gets much stronger when teams stop asking only “what are the common scams?” and start asking “what is actually happening in our environment?”
That is the better question.
Because one retailer may be dealing mostly with online gift card fraud tied to stolen cards or account takeovers. Another may be seeing more store-level scam pressure. Another may be struggling with internal process blind spots, delayed detection, or weak coordination between fraud, support, and store operations. The broad category is the same. The root problem can be very different.
That is why fraud process assessment matters so much.
If I do not understand my own version of the problem clearly, I am much more likely to buy the wrong tool, apply the wrong rule, or waste time solving the least important part of the issue.
- Gift card fraud prevention works best when it is built around the company’s real fraud pattern, not just industry headlines
- Fraud process assessment helps teams distinguish between common category risk and business-specific weakness
- Gift card fraud detection improves when retailers map what is happening across channels and workflows
- Gift card fraud best practices are most useful when they are adapted to the actual business model and abuse pattern
How to know whether your current controls are working
A lot of teams already have some kind of control environment in place for gift cards. The real question is whether it is actually working well enough for the current threat.
That is not always obvious.
A control can look good on paper and still be too slow, too narrow, too easy to bypass, or too disconnected from the rest of the fraud operation. A tool can be technically active and still not be reducing the losses that matter most. A process can feel familiar and still be overdue for a hard reassessment.
This is why I think Jarrod’s perspective is especially helpful here.
The conversation is not just about what controls exist. It is about how to assess performance honestly. Are the losses going down in the right areas? Are teams catching abuse earlier? Are store teams or support teams seeing patterns that the fraud system is missing? Is the fraud risk stack still aligned to today’s abuse methods, or is it mostly defending against yesterday’s?
- Fraud controls for gift cards need to be judged on actual performance, not just whether they exist
- Gift card fraud detection is only as useful as the speed and actionability of the signals it produces
- Fraud process assessment should include tools, people, workflows, and cross-team visibility
- A fraud risk stack needs regular review because gift card scam trends change faster than many controls do
When it may be time to add resources or change the stack
Sometimes the answer is not that the team needs to work harder. Sometimes the answer is that the current setup is no longer enough.
That matters because fraud teams are often asked to stretch existing tools and processes long past the point where they still fit the problem well. And gift card fraud is one of those areas where the cost of waiting too long can add up fast.
If patterns are scaling, if detection is lagging, if store-level or digital signals are being missed, or if customer harm is becoming more visible, then it may be time to add resources, strengthen review, or expand the fraud risk stack. Not because more tooling is always the answer, but because sometimes the environment has changed enough that standing still becomes its own risk.
That is the part I think teams need to be honest about.
Good gift card fraud prevention is not static. It has to evolve as the scams evolve.
- Gift card fraud prevention sometimes requires more support, not just better effort
- Retailer payment fraud risk grows when controls no longer match the speed or shape of the abuse
- Fraud risk stack decisions should be driven by current loss patterns and operational gaps
- Gift card risk management gets stronger when teams are willing to reassess the stack before the losses become normalized
The big takeaway from this episode is pretty straightforward. Gift card fraud prevention gets much stronger when teams stop treating gift cards like a small side issue and start treating them like the fast-moving, high-misuse value channel they really are. In my conversation with Jarrod Price, what stands out most is that strong prevention comes from understanding the specific fraud patterns affecting your business, assessing the current process honestly, and being willing to evolve the controls, people, and tools around the real problem.
