Lawsuit claims Google is profiting from gift card fraud

Lawsuit claims Google is profiting from gift card fraud

A class action complaint filed this week in the federal court for the District of North California argues that Google has knowingly benefited from gift card scams, keeping millions of dollars in stolen money from victims of fraudulent schemes.

The complains involves Google Play gift cards, and alleges that Google retains funds from stolen gift cards either by taking a commission from payments to Google Play app developers made with fraudulently obtained cards, or by withholding funds paid via such cards.

Apple also recently faced similar allegations, agreeing to settle a lawsuit relating to App Store and iTunes gift cards.

Google profits from fraudulent gift cards

The complaint cites FTC data revealing that gift card fraud losses totaled more than $433 million between 2018 and 2021. An estimated one in five losses were attributable to Google Play scams.

The filing argues that Google has not adequately warned customers about the risks of gift card scams, and that it discourages victims from seeking stolen fund recovery. A support page addressing scams mentions the non-refundability, with the exception of where a refund would be required by law.

Gift cards have been a concern globally for many years, with scammers more easily able to take money from them than credit and debit cards, which they can then use for their own purchases or to sell on.

In the case of this lawsuit, the complaint alleges that Google possesses the necessary information to restore lost funds, however Indiana resident Judy May, who brought about the case, is yet to receive any financial support from Google for the $1,000 she lost to gift card fraud in April 2021.

TechRadar Pro has asked Google to share any comments or context about the case and its gift cards, but the company did not immediately respond.

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Craig Hale

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