Retailers are cracking down on how gift cards can be purchased -

Retailers are cracking down on how gift cards can be purchased

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(Credit: CNN) (Credit: CNN)

NATIONWIDE ( - Now that retailers are responsible for fraudulent purchases, many are changing their policies as it relates to buying gift cards.

Back in October, new rules kicked in requiring retailers to have chip-enabled card readers.  However, many stores still lack the new technology which provides an extra layer of security.  Without chip-readers, it is easier for someone to use a fraudulent card to purchase gift cards for personal use.

As a result, many retailers are requiring customers to pay for gift cards with cash.  If a customer does not want to pay for a gift card with cash, there will be a limit on the number of gift cards they can purchase in a 24-hour span. 

Some retailers have gone so far as to stop selling certain types of cards, especially the cash gift cards issued by Visa and Master Card, because they offer greater flexibility and are more appealing to scammers.

According to the National Grocers Association, fraudulent gift card purchases cost retailers nearly $4 billion in 2014 alone.

Copyright 2016 KMOV (Meredith Corporation). All rights reserved.

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