Mounting Credit Card Fraud Forces Giant Food Policy Change

Mounting Credit Card Fraud Forces Giant Food Policy Change

Bitcoinist_Giant Food

Credit card fraud remains one of the biggest financial threats to consumers all over the world. Giant Food, a grocer in the Washington area, has stopped accepting credit card payments when buying gift cards or prepaid debit cards.

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Giant Food Prefers Less Credit Card Payments

Bitcoinist_Giant Food Credit Card Fraud

It does not happen often retailers stop accepting one of the more popular payment methods in the world today, but Giant Food saw no other options. The grocer has been dealing with massive amounts of fraudulent credit card transactions by customers buying prepaid debit cards or gift cards to use at the store.

In fact, the store has put a clear sign at the checkout warning customers credit card payments are no longer accepted for gift and prepaid debit cards. To buy these items, consumers must pay in cash or use bank pin-based debit. This policy change went into effect in March of 2016 but has gone by unnoticed by the media for some unknown reason.

Criminals obtaining stolen credit cards tend to target groceries and other smaller retailers more often than not, so it makes sense Giant Food is preventing these types of purchases all of a sudden. Moreover, with the number of credit card phishing attempts on the rise, a lot of criminals resort to embossing their own cards, which are then cashed out through grocery stores such as Giant Food.

Laundering money with stolen credit cards has become a lot easier throughout the years. Converting a card into a gift card effectively launders money, as the gift card can be resold for cash or any other payment method. This type of criminal activity is often conducted by street gangs, as it is one of the easiest ways to get quick and clean cash.

Some people might argue the EMV chip should prevent these types of fraudulent activity, and there is a certain merit to that statement. However, as Krebs on Security mentions, most of the Giant Food cashiers will swipe a chip-based card, negating the additional security. Unfortunately, far too few retailers allow for chip transactions, regardless of whether or not they have the necessary terminal installed.

Bitcoin transactions would make a lot more sense as they negate credit card fraud entirely. But at the same time, it would require a fair bit of staff training to get cashiers up to speed on how Bitcoin transactions work. Moreover, consumers would have to embrace the payment solution as well, which will be the biggest hurdle to overcome.

What are your thoughts on grocery stores falling victim to large-scale credit card fraud? Let us know in the comments below!

Source; Krebsonsecurity

Images courtesy of Giant Food, Shutterstock

Jp Buntinx

Jp Buntinx

JP Buntinx is a freelance Bitcoin writer and Bitcoin journalist for various digital currency news outlets around the world. In other notes, Jean-Pierre is an active member of the Belgian Bitcoin Association, and occasionally attends various Bitcoin Meetups in Ghent and Brussels

  • Duncan Betts

    You say it would take a fair bit of work to get cashiers up to speed on how bitcoin payments work.

    I imagine if a major retailer such as Giant Food were to accept bitcoin, they would equip the till with the necessary equipment (in terms of additional hardware at the till this comprises of a screen measuring at least 4″ across, which would display the QR code). The cashier could simply select bitcoin on their touchscreen till, and then after the customer has made the payment, their till would need to tell them “payment complete” or something like that.
    If you wanted to train cashiers to be able to assist a customer, to the same level that they can with a card or cash payment, I suppose that would involve them knowing where the screen was and directing them towards it.
    If the payment failed in some way (aka the customer didn’t know what they were doing/didn’t have sufficient funds), the cashier could request alternative payment – as they do with card or cash payments presently.

    Seems to me the reason Giant Food don’t accept bitcoin is more likely that neither BitPay nor Coinbase have really tried to get them on board – it’s my understanding that these companies are focusing on other things like digital goods payments online – a market where card payments have failed miserably. Probably better to wait until there’s enough ordinary customers (not bitcoin aficionado’s, actual normal customers) wanting to pay using bitcoin, at that point retailers will happily make the modifications to their systems (I doubt they actually like taking card payments, with the costs involved. A system like bitcoin that costs them almost nothing (or perhaps, simply nothing), has no chargebacks, and potentially, cleared funds in their account 10-30 minutes later, is surely their ideal).

  • Homero Garza

    Dummies should take bitcoin

  • RJF

    Exactly! It’s easy as using a CC with QR codes. And, there’s NO CC fees involved. It’s a “no brainer” really, just need to educate them. I have often wondered if there is some darker reason big retailers don’t accept Bitcoin. Such as behind the scenes threats from CC processors? Just a thought, would make a great article if there’s any truth to it…

  • Duncan Betts

    I’ve spoken to (small) business owners about bitcoin. They don’t accept it because:
    They haven’t heard of it
    They have heard of it vaguely but taken no interest in it
    Their customers have never asked them about it
    They’re not sure about the legal/tax/accounting side of things
    They ask their trusted experts about it, and didn’t get useful responses
    Their trusted experts haven’t advised them to accept it (or mentioned it at all)

    Lots of online retailers don’t use sofortebanking, which is a very cheap and good option for them in Europe. PayPal seems to be growing in market share despite much higher fees than Braintree (who they own, I realize).

    I don’t think the Google search results are great for the types of things a retailer might look for if curious about this topic. BitPay have some good pages that will probably show up, but outside of that.