The North Carolina House of Representatives approved a bill on Tuesday targeting gift card theft, a crime that can result in tens of millions of dollars in losses and leave customers with empty, unusable cards.
House Bill 315 adjusts penalties for two criminal acts: unlawful entry into businesses and gift card theft; the main focus is on the latter. Thieves take gift cards from store racks, record their information, and then return them to the store. When an unsuspecting customer purchases the gift card, the thieves can steal the funds once the card is activated, leaving the buyer with a worthless piece of plastic.
“What really got this discussion going is, apparently, now there’s individuals that go into retail stores, take the gift cards off the rack, capture the numbers, put the gift cards back on the rack, and then when someone comes and purchases the gift cards and they’re activated, they’re able to capture the money prior to the individual that purchased a gift card,” explained Rep. Reece Pyrtle, R-Rockingham.
The bill seeks to criminalize the following actions:
- Acquiring or retaining possession of a gift card or gift card redemption information without the consent of the cardholder or card issuer.
- Obtaining gift card information through fraudulent means.
- Altering or tampering with gift cards or their packaging with the intent to defraud others.
If the value stolen is less than $1,000, the offense would be classified as a Class 1 misdemeanor. If the stolen amount exceeds $1,000, the crime would escalate to a Class H felony.
The proposal was met with overwhelming support in the House. Rep. Laura Budd, D-Mecklenburg, described to legislators how criminals operate, stealing gift card information and returning cards to stores, only for consumers to later discover their cards have been drained.
The bill passed its second and third readings in the House with a unanimous vote and now heads to the Senate for further consideration.
If enacted, House Bill 315 will provide North Carolina with stronger legal tools to fight organized retail crime and protect consumers from falling victim to gift card fraud.
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