Green Dot Gift Card Lawsuit Alleges ‘Poor Packaging’ at Walmart Stores Allows for Tampering, Theft of Money

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A proposed class action alleges the poor packaging and “minimal security” of Green Dot gift cards sold at Walmart allowed the cards to be easily tampered with, leaving consumers to discover that the cards they paid for have no value. 

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The 20-page complaint says that while consumers are ultimately stuck with “worthless” gift cards and out whatever they paid to load the cards with funds, defendants Walmart and Bonneville Bank “pocket the purchase fee associated with the sale.” 

“Thus, Defendants are being unjustly enriched to the detriment of consumers, such as Plaintiff, a retired schoolteacher who was purchasing the gift cards as a Christmas present for her grandchildren,” the lawsuit states, claiming the consumer, a Montgomery, Alabama resident, felt “embarrassed” to learn that the gift cards intended for her grandchildren, for which she paid hundreds of dollars, were worthless. 

According to the suit, the plaintiff gave four of her grandchildren $100 Visa prepaid gift cards for Christmas last year. However, when they went to use the gift cards, they learned that the cards contained no money, essentially that “[t]heir grandmother had given them $0,” the filing says. 

When the plaintiff, “[e]mbarrassed and upset,” contacted Walmart, she was “met with an unfriendly employee who refused to assist her or allow her to speak to a manager,” the suit alleges. The plaintiff then called Walmart corporate, only to learn that the money could not be refunded since the gift cards were purchased from a third party, Green Dot, the issuer of the cards, the case states. 

“Ms. Lyons called and emailed Green Dot numerous times but never received her money back,” the lawsuit says, noting that the plaintiff contacted her local radio station and the Better Business Bureau about her situation.

As the suit tells it, scammers “relish Green Dot’s poor packaging and Walmart’s minimal security” of the gift cards at issue. Often, scammers will place fake bar codes over the real Green Dot bar codes on the cards, and/or replace the cards with different cards so that, when the Green Dot cards are activated by a Walmart employee, the funds “go directly to the third party rather than the buyer,” the complaint shares. 

“Upon activation, third parties are able to utilize their barcodes to deplete or use the funds loaded by the buyer onto the gift card,” the filing says. “As a result, the purchased Green Dot cards become worthless prior to any authorized use by the consumer.” 

The lawsuit accuses Bonneville Bank and Walmart of being well aware of the “ongoing and rampant scam” involving Green Dot gift cards. Despite this, Walmart employees are not properly trained to inspect gift cards for tampering, and both defendants “commonly refuse” to reimburse consumers for gift card money that is stolen, the suit alleges. 

Moreover, neither defendant, despite being aware of the scam problem, has implemented more secure packaging for Green Dot gift cards, the complaint states. 

“Instead, they continue to sell the gift cards with knowledge that they are susceptible to tampering by third parties and that there is a risk to the consumer that their gift card will be worthless after purchase,” the case reads. “Defendants also continue to fail to warn Plaintiff and putative Class members about this risk.” 

The lawsuit looks to cover all persons in the United States who bought a Visa prepaid gift card issued by Green Dot from a Walmart retail store located in a state that has adopted Article Two of the Uniform Commercial Code, and found that their card was subject to unauthorized use after purchase but prior to the first authorized use. 

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