Fraudulent charge on new pre-paid credit card. How to fix?

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CFM300
Posts: 1328
Joined: Sat Oct 27, 2007 5:13 am

Fraudulent charge on new pre-paid credit card. How to fix?

Post by CFM300 » Mon Feb 12, 2018 11:02 pm

On Friday, a friend was given a prepaid VISA card with $500 on it. Today, she went to the card's website to see if she had to activate it before using. To her surprise, the card had been wiped out. The transaction history shows that it was purchased in California on Friday and was used at a Walmart in an adjacent state today for a single purchase less than $2 short of the $500 balance. So it seems someone knew the exact amount on the card. Friend called the card company. They filed a report, canceled the card, and are sending a replacement card -- with a balance of less than $2. They said that it will take 45 to 90 days to reach a decision on whether the $498+ will be refunded. Two questions:

1. How does such a thing happen? The card was in a package and none of the numbers were visible, just the barcode.

2. Is there anything my friend can do to ensure that the money is refunded to the card? Call the Walmart? File a police report?

Thanks.

Nate79
Posts: 2332
Joined: Thu Aug 11, 2016 6:24 pm
Location: Portland, OR

Re: Fraudulent charge on new pre-paid credit card. How to fix?

Post by Nate79 » Mon Feb 12, 2018 11:39 pm

How was the card purchased?

CFM300
Posts: 1328
Joined: Sat Oct 27, 2007 5:13 am

Re: Fraudulent charge on new pre-paid credit card. How to fix?

Post by CFM300 » Mon Feb 12, 2018 11:43 pm

Nate79 wrote:
Mon Feb 12, 2018 11:39 pm
How was the card purchased?
At a grocery store.

tev9876
Posts: 75
Joined: Thu Sep 14, 2017 9:12 am

Re: Fraudulent charge on new pre-paid credit card. How to fix?

Post by tev9876 » Tue Feb 13, 2018 10:13 am

Pretty common. If you go to a Manufactured Spending forum (Flyertalk, Reddit) where the purchase of these cards is common you will see many reports. I know there are threads at Flyertalk about being scammed so that may offer some help.

Scammers have been known to steal unpurchased cards, carefully open the packaging, capture the card number and then carefully reassemble the packaging and sneak them back on the shelf. Issuers have gotten better about much tighter packaging, but make sure there is nothing "off" about the package of any prepaid card you buy - crooked corners, tears, extra glue, etc.

CC numbers are also based on algorithms so there is an ability to guess the numbers and expiration dates. Could also be insiders stealing the information.

Once the scammers have a valid number they just keep checking until it is loaded. From there it is a trivial matter to clone a card and drain it as soon as they detect available funds.

I don't buy the $500 visa/MC any more, but do stock up on Amazon, Home Depot and other gift cards at Kroger when they run gas point promotions. Combined with a 6% cash back Amex (Blue Cash Preferred) I net 20% back. Amazon cards I will load to my account by cell phone as soon as I get to my car. I stick with smaller values on the others figuring it is more work for a scammer to steal 10 $50 cards vs one $500

CFM300
Posts: 1328
Joined: Sat Oct 27, 2007 5:13 am

Re: Fraudulent charge on new pre-paid credit card. How to fix?

Post by CFM300 » Thu Feb 15, 2018 12:25 am

Thanks for all that. Much appreciated.

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