The fight against gift card fraud takes a significant leap forward today with the announcement that Michigan Attorney General Dana Nessel has been named the inaugural attorney general strategic partner of the Gift Card Fraud Prevention Alliance (GCFPA). This public-private partnership, as Attorney General Nessel highlights in a video, brings together leaders from law enforcement, retail, gift card networks and consumer advocates across the nation, united by a shared mission: to protect consumers, especially the most vulnerable, from the evolving threat of gift card fraud.
Gift Card Fraud: A Growing National Challenge
Gift card fraud has emerged as one of the most prevalent forms of consumer scams in the United States. According to recent data from the Federal Trade Commission, Americans reported losses exceeding $228 million to gift card scams in 2023 alone, with the real number likely much higher due to underreporting.
The rise of gift card fraud, like card tampering and gift card scams, is a growing component of the Organized Retail Crime epidemic taking place across North America. This type of fraud is frequently carried out by multinational criminal rings and is connected to broader illegal activities.
A United Front: Launching the Gift Card Fraud Prevention Alliance
The GCFPA is a new coalition, run by the Retail Industry Leaders Association Communities Foundation, founded to facilitate unprecedented collaboration and information sharing among stakeholders from the public and private sectors. By uniting law enforcement agencies, retailers, payment processors, technology companies, and consumer protection organizations, the GCFPA aims to create comprehensive strategies for reducing gift card fraud, educating the public, and holding perpetrators accountable.
As the Alliance’s inaugural partner, Attorney General Nessel brings a proven track record of consumer protection advocacy, innovative policy leadership, and a deep commitment to safeguarding Michigan families. Her office has handled thousands of fraud cases and has been instrumental in educational initiatives to protect consumers from a range of scams.
Since taking office, Attorney General Nessel has prioritized the fight against scams that disproportionately impact vulnerable citizens. Her office’s Consumer Protection Team has worked closely with local law enforcement, AARP, and community groups to spread awareness and provide resources for scam victims. With the strategic partnership of the GCFPA, she looks to expand that commitment.
“Gift card fraud is a growing threat that targets everyday consumers,” said Attorney General Nessel. “I am proud to partner with the Gift Card Fraud Prevention Alliance to bring together law enforcement, retailers, and consumer advocates to fight these scams. Together, we will educate the public, hold fraudsters accountable, and make it far more difficult for criminal organizations to target Michigan families and businesses.”
In January 2023, Attorney General Nessel created the Focused Organized Retail Crime Enforcement (FORCE) team the first task force of its kind in the nation. This task force is focused on fighting organized retail crime across the state of Michigan. To date, the FORCE team has charged more than 85 defendants in 42 major cases, recovered over $10 million in stolen merchandise and millions more in cash and cryptocurrency, and stopped major criminal rings in their tracks.
“Michigan Retailers Association has strongly advocated for continued funding for the FORCE team and bipartisan legislation to include gift card fraud in Michigan’s ORC law,” said Bill Hallan, President and CEO of Michigan Retailers Association. “We are thrilled to support this alliance that strengthens our fight against new forms of Organized Retail Crime impacting both retailers and Michigan consumers.”
Earlier this year, the FORCE Team charged two individuals for conducting an alleged large-scale fraud scheme that began with the theft of empty, unsold gift cards from retail stores. The cards were then tampered with to reveal their unique redemption numbers, recorded by the scammers, then concealed once again with an adhesive to appear as though they had not been tampered with. It is alleged that the scammers then returned the altered gift cards to their original intended retail point of sale and used computer programs to monitor when any card was activated with a balance of funds. As soon as a shopper placed a balance on the card, the scammer was able to transfer the balance into another digital account.
The gift card, when given as a gift and redeemed, was already depleted.
Attorney General Nessel recently released a video alerting consumers to the gift card scam, detailing how the scam is believed to operate, and offering tips to avoid becoming a victim.
On September 9, the Michigan House of Representatives also passed House Bills 4598 and 4599, legislation spearheaded by the Michigan Retailers Association to amend the Organized Retail Crime Act to classify certain forms of gift card fraud as organized crime. Under the legislation, which is supported by the Attorney General, a person is guilty of organized retail crime if they knowingly and intentionally:
The legislation will now advance to the Michigan Senate.
"Attorney General Nessel’s unwavering commitment and proactive leadership have been instrumental in uniting public and private sectors to fight gift card fraud," said Lisa LaBruno, Executive Director, RILA Communities Foundation. "Her dedication ensures that consumers in Michigan—and across the nation—are collaborating to prosecute criminal rings that orchestrate gift card scams. We are deeply grateful for her partnership and tireless efforts to work with retailers to safeguard our communities."
The Gift Card Fraud Prevention Alliance formed in 2024 and is part of the Retail Industry Leaders Association (RILA) Communities Foundation (RCF), a 501(c)(3) non-profit organization, with a mission to promote, foster, and encourage the vibrancy of communities in which retailers operate by supporting efforts to advance economic health and public safety. RCF leads the Gift Card Fraud Prevention Alliance (GCFPA) which was created to educate lawmakers and the public about gift card fraud, enhance collaboration among the private and public sectors to investigate criminal activity, and drive innovation to combat fraud.
For more information about the Gift Card Fraud Prevention Alliance and resources on preventing gift card fraud, visit protectmygiftcard.com.
Media Contacts
Office of the Michigan Attorney General: Danny Wimmer, agpress@michigan.gov
Michigan Retailers Association: Drew Beardslee, abeardslee@retailers.com
Gift Card Fraud Prevention Alliance: Melissa Murdock, melissa.murdock@rila.org