alt Hacker NewsI understand why Apple sells gift cards. I understand why brick and mortar stores sell gift cards for third parties like Apple.
But what do the credit card companies get out of this arrangement? It seems like they’re taking on a whole lot of unnecessary risk and enabling these scams by allowing third party gift cards to be purchased using a credit card.
Hello,
I work for a major gift card company. These views are my own and not that of my employer.
The credit card companies take zero risk in this transaction, because we, the company selling the gift card, take the risk.
To this end, my personal job is building systems to prevent and combat credit card fraud. It's not terribly complicated in fact. The team I originally started with a decade ago was like three people.
Every gift card purchased by a stolen credit card is a direct loss to our revenue. We strongly want to keep that amount small. We do a pretty good job of it.
We have a large department of REAL HUMANS you can call to get help with your gift card. In the past, they have had very upset grandmas calling in to ask about why they can't purchase iTunes gift cards because they need them to get their nephew out of prison. Those calls are very sad.
Physical gift cards have no value until you pay the cashier. Despite this, physical gift card security is tough. The plastic card has to be shipped out and sit on a shelf and be directly available to anyone to tamper with. We have made some efforts to reduce that threat, but there isn't much we can do.
If you are in the US you have absolutely used our company's products and if you have bought a gift card online there's a 90% chance your transaction details have run through my code.
Frankly, I do not understand why Apple would have banned an account for trying to redeem a scammed or tampered with card. That doesn't make any sense.