A Thing
The Green SheetGreen Sheet

Thursday, May 23, 2013

'Cash reload' scam comes to light

On May 20, 2013, the Wisconsin Better Business Bureau warned of a new scam involving Green Dot Corp.'s reload service, MoneyPak. The Wisconsin chapter of the national business standards organization reported that scammers are contacting consumers with news that they have won either a lottery or sweepstakes, or alternatively can purchase a discounted product or service, and then instruct individuals to buy MoneyPaks to fulfill the awards or offers.

The Wisconsin chapter provided details of the scam. Scammers tell potential victims they need to purchase MoneyPaks to be used to pay fees in order to receive prizes or prepay for merchandise. Individuals then purchase the reload cards from retail locations and then reconnect with fraudsters, at which point scammers ask for the 14-digit code found on the back of the card.

MoneyPaks are used to reload already purchased general-purpose, reloadable prepaid cards, such as Walmart MoneyCard or Green Dot's own proprietary prepaid cards. In a statement directed at consumers, the Wisconsin Better Business Bureau said, "Once you've given them that code, you've given them instant access, and the crooks can transfer your MoneyPak funds to their own prepaid cards."

Wisconsin Better Business Bureau spokeswoman Lisa Schiller said this type of scam is not local to Wisconsin, but is a national problem. She noted that scammers usually ask consumers to load between $100 and $500 on the Green Dot cards, with one Wisconsin resident victimized by the scam offered heavily discounted cable TV service.

The individual loaded $350 onto MoneyPak and then provided the account number to the scammer, who promptly drained the account, according to Schiller. Since the funds loaded onto the card was cash, the individual had no recourse to recoup the loss, she added.

In related news, the Federal Trade Commission reported on May 21 that it wants to amend the Telemarketing Sales Rule to strengthen consumer protections against telemarketing abuses, such as "cash reload" scams. end of article

Editor's Note:

The Green Sheet Inc. is now a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals. Click here for more information.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

Facebook
Twitter
LinkedIn
2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
A Thing