Several Phoenix-area pool and spa retailers were the victims of a
gift-card scam and have changed certain policies in response.
Stores began noticing the problem when they started receiving
chargebacks from credit card companies for purchases of $400 to
$500 made with gift cards.
It is believed that the scam is the brainchild of two men. The
team visited stores to purchase an automatic cleaner that had a
rebate offer in effect, explaining that they were buying it for an
elderly female relative. When it came time to pay, they would
present a Visa gift card. In at least some cases, when the sales
associate would try to swipe the card, the transaction
wouldn’t go through, so the store employee would input the
numbers by hand, after which they received approval.
Several weeks later, the stores received notifications stating
that the purchases were made fraudulently and the charges were
reversed. One financial institution cited a stolen credit
Local police are currently investigating the scam. It is believed
that the criminals somehow imprinted stolen credit-card numbers
onto gift cards.
The retailers also notified the manufacturers of the cleaners
and provided serial numbers for the equipment, so they would know
when the thieves were trying to register the equipment and collect
the rebate money.
Because the purchases were made with gift cards, the retailers
had no recourse and had to accept the losses. “It’s a
double whammy — they reversed the charges and we were out the
product,” said David Hagen, vice president of operations at
Cactus Valley Pool Supply in Gilbert, Ariz.
Gift cards display no name for a giver or recipient, which makes
it more difficult to protect against fraud. To prevent future
occurrences, a number of retailers have changed their policies for
dealing with gift cards, with some setting dollar limits. Diane
Rhodes no longer accepts gift cards over $50. “I’m
leery to take any,” said the owner of Pool Shop in
Scottsdale-based A&M Corson’s AquaValue will accept
gift cards of up to $100. “Most gift cards aren’t for
more than $100,” said company coordinator Cerah Gray.
Additionally, the company no longer allows its staff to manually
input the numbers from the gift card — if it doesn’t
register on a swipe, it isn’t accepted.
Some retailers with multiple branches were victimized at more
than one location. A&M, for instance, was hit three times and
an attempted fourth — each at different stores. “By
[the fourth] we had already figured it out,” Gray said.
“I was alone in the store at the time, so I really wanted to
avoid any type of confrontation. I told him, ‘I’m
sorry, but corporate passed down a policy that we are not allowed
to type in the numbers if the card doesn’t swipe.’
“He made several excuses, like if the card doesn’t
work, he doesn’t know how he’s going to feed his kids
tonight, and he backed all the way out the door and left. He was
still talking when he left out the door. He was very