Walmart Inc. faces a lawsuit that claims the retailer sold unsuspecting customers store gift cards it knew could have been tampered with by scammers.
In the lawsuit, filed Thursday in U.S. District Court for the Eastern District of Arkansas, 29 plaintiffs say they bought Walmart gift cards and loaded money on them, only to learn when they tried to use the cards that the funds had already been used by an unknown third party or that Walmart had deactivated the account. The plaintiffs claim Walmart did not reimburse them for the lost funds.
According to the complaint, "Walmart knew that scammers would enter its stores, remove the security tape from its gift cards, log the card's PIN, and use the PIN to remove customer funds after the customer loaded money onto the gift card.
"Consumers have lost millions of dollars that they loaded onto the gift cards because Walmart failed to take adequate and reasonable measures to ensure that scammers did not tamper with the gift cards and failed to disclose to its customers the material fact that it was possible the gift cards had been tampered with."
The complaint acknowledges that the exact number of customers affected by the scam is unknown. However, it states that thousands may have been harmed and that losses could total millions of dollars.
Walmart spokesman Randy Hargrove said the company takes seriously "any criminal behavior in connection with our gift cards."
"The people committing these acts are criminals, and we have measures designed to help guard against these types of crimes," Hargrove said. "We frequently review our consumer protection measures and protocols. We are reviewing the complaint and will respond appropriately with the court."
The case is Gracie Foster et al v. Walmart Inc. et al.
All of the incidents described in the complaint occurred in 2017 and 2018, and represent incidents in 24 states -- including Arkansas -- plus the District of Columbia. Plaintiffs had loaded amounts ranging from $20 to as much as $500 onto the affected cards, according to court records.
The plaintiffs are asking the court to award damages, restitution, interest and attorney fees. They are also requesting a jury trial.
Consumer Reports, the Retail Gift Card Association and the website Scambusters.org provide a number of tips consumers can use to protect themselves from this type of scam.
First, don't buy gift cards from store display racks. Also, don't assume that cards kept behind a counter or that are otherwise inaccessible to the public are safe.
Shoppers should always carefully examine both the front and back of a gift card before buying it, the site advises. If a security code number is visible on the card, put it back and get another. Don't buy any card that looks as if it may have been tampered with.
Asking the store cashier to scan the card will ensure that it is valid and reflects the amount loaded on it. Keep the receipt as proof of purchase as long as there is a balance on the card, and where available, register the card at the store's website.
And if the worst happens, victims of gift-card fraud should file a complaint with their state attorney general's consumer protection office.
Business on 08/17/2019