Walmart has drawn the ire of nearly 30 plaintiffs who allege in a proposed class action lawsuit that the mega retailer has failed to take adequate and reasonable measures to ensure scammers do not tamper with gift cards.
“The problem with the Walmart Gift Cards is rampant and widespread and Walmart is well-aware of the problem,” the plaintiffs allege, “yet Walmart continues to sell insecure Gift Cards.”
The 206-page lawsuit out of Arkansas alleges defendants Walmart, Walmart Stores of Arkansas and Walmart Stores East have known for some time that thousands of gift cards sold to consumers nationwide have been tampered with, resulting in proposed class members being unable to use funds loaded onto the store-brand cards. According to the suit, which outlines alleged consumer protection law violations for all 50 states, Walmart has also known that scammers who enter its locations could physically remove the security tape from gift cards, log a card’s PIN and then use that PIN to steal money eventually loaded onto the gift card by a customer. All told, consumers have lost millions due to both Walmart’s failure to ensure gift cards are not tampered with and its apparent failure to disclose the possibility that gift cards could be tampered with, according to the lawsuit, which estimates that it’s “likely thousands of customers have been harmed.”
“Walmart knew or should have known that one method the third parties were using to learn the secret eight digits involved the third parties taking possession of the cards, removing the security tape covering the PIN numbers on the Gift Cards, recording the eight digits and replacing the tamper evident tape with a commercially available equivalent substantially similar, but not identical, to the original tamper evident tape or other such means,” the lawsuit reads.
Despite its knowledge of the issue of gift card tampering, Walmart, the case argues, “has done nothing” to remedy the problem. In certain circumstances, Walmart, the lawsuit says, will send a consumer an email containing a password to activate a gift card. This option, however, was not afforded to the plaintiffs nor proposed class members, many of whom were denied access to the money on gift cards because they were deactivated and not replaced by Walmart, the case states.
With regard to Walmart’s apparent awareness of the unlawful tampering of its gift cards, the complaint points out that the retailer has “received enough customer complaints” that it should have known consumers were being denied access to the money loaded onto gift cards.
The lawsuit proposes to cover a class of consumers across the United States who bought a compromised Walmart gift card from a Walmart retail location and who either had funds loaded onto a gift card used by a third party due to tampering or had a card or cards deactivated by Walmart prior to first use that Walmart refused to replace, reactivate or refund.