State lawmakers across the country are continuing to take action against the rising trend of gift card theft and fraud.
In a typical gift card tampering case, thieves steal unactivated gift cards from store displays and tamper with the card by recording their activation numbers in a special computer program before returning them to the store. Once a consumer buys and activates the card, the thief can quickly drain the funds.
Stolen gift cards without value present a challenge for prosecutors since thieves can steal large quantities of unactivated gift cards and face little punishment. (The Department of Homeland Security has stated that organized gift card theft rings are often part of larger criminal networks taking part in various illegal activities.)
So far this year, ten states – Arizona, Arkansas, Florida, Iowa, Kentucky, Louisiana, New Hampshire, North Carolina, Texas and Utah — have enacted bills modeled after Ohio’s 2024 legislation, which creates the offense of gift card fraud and allows prosecutors to charge thieves who use money from stolen gift cards, even before they have value.
Massachusetts and Michigan still have legislation under consideration. In Massachusetts, retailers and gift card manufactures have advocated for bills that set penalties for accessing gift cards without the owners’ consent (MA HB 1611) and amending existing law to set penalties for defrauding, tampering or altering a gift card (MA SB 1209). In Michigan, lawmakers introduced legislation (MI HB 4599 and MI HB 4598) in June to add gift card fraud to Michigan's Organized Retail Crime Act.
Lawmakers in seven states – California, Colorado, Connecticut, Georgia, Maryland, Minnesota and Maine — considered gift card fraud bills that included prosecutorial language but ultimately ran out of time before their sessions ended. Industry advocates are looking to continue their efforts on gift card fraud next session, especially in larger market states like California, Illinois and New York.
Legislation Targeting Gift Card Fraud