SCSO fighting gift card fraud linked to drug activity

SHELBY COUNTY, TN (WMC) - Shelby County Sheriff's investigators are part of a nationwide fight against gift card fraud being used to fund drug addictions.

The detectives were recently profiled in a CNBC story about the trend.

The scheme works by drug addicts stealing items from big name stores like Home Depot or Target. They then return the items at different store locations.

But the crooks have to accept a card for store credit since they don't have a receipt.

Nonetheless, those cards can be turned back into cash to score more drugs.

"They'll sell this $50 card for $25.  Everybody makes money," said SCSO Lieutenant David Ballard. "Of course, you're defrauding the state out of their taxes and the shrink at that store is going to be passed on to the consumer at the register.  It's a win-win for the bad guys but it's a lose-lose for us."

The retail industry estimates return fraud costs $9 to $15 billion a year.

Stores are starting to fight back, though, by requiring IDs for returns and limiting the amount of store credit they will give.

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