$72,000 was average loss for Gift Card providers

Theft of gift cards and their value has been widely discussed on this blog. The primary method of theft is the one involving theifs copying all the info of the cards in gift card kiosks and then waiting for these cards to 'come to life'.

It is too cumbersome for merchants to split out the losses from gift cards alone. A study in 2007 estimated that the larger merchants lost an average of $72,000 in 2007. Given the hard hit that the econmoy has had, I would guess that these numbers have remained relatively flat through 2008 and into 2009.

Gift Card theft was brought to light on the interenet by a Sheriff in Oregon. He caused an internet sensation when he wrote a quick blog piece discussin a ring of meth dealers and users who were feeding their habit with stolen gift cards. Certianly the theft of these gift cards is getting harder and harder but the solutions are not bullet proof. While the gift card kiosks are the primary source of theft, they are too popular to be done away with. That would be throwing the baby out with the bath water. A solution simply needs to be found to hide the data on the back of the cards that the thiefs are aggregating. I am sure it is right around the corner.