SHAKOPEE, Minn. (FOX 9) - Third party gift cards are at the center of a new ordinance intended to crack down on fraud in Shakopee, Minnesota.
Anyone looking to buy Visa, American express, or Mastercard gift cards using a credit card will now have to show a government-issued photo ID. Also, purchases made at the self-service checkouts will no longer be allowed.
“The ordinance was really born out of frustration,” said Shakopee Police Chief Jeff Tate. “This is five or 10 seconds to take your identification out and make sure it matches the card. I don’t think that’s asking too much, and the payoff in the long run could be really good.”
Chief Tate said that fraud is consistently one of the top three crimes reported in the city. In the last year, fraud cases were up 17 percent. According to the chief, criminals are drawn to gift cards because they can get cash quickly while mostly remaining anonymous.
“Right now, it’s just too easy for people to walk in, grab these gift cards and start loading them up with either a stolen or cloned credit card,” he said.
But, not everyone is on board, with some stores allegedly pulling gift cards from their shelves.
The Minnesota retail association released a statement that reads in part, “the city ordinance conflicts with business partner agreements and raises the potential for a clerk to be cited with a misdemeanor crime.”
Despite some pushback, Chief Tate believes other cities will adopt similar ordinances.
“We’re the first, and hopefully not the last. We’ve had some inquiries from some outside agencies about this ordinance,” he said.