This story about gift card thieves is both amusing and educational. On the amusing side, the thieves were caught because Toys-R-Us officials became suspicious when 4,600 calls to the automated gift-card balance line came from a single phone number at the thieves house, which ultimately resulted in thieves being arrested.

On the educational side, it reminds us that closed-loop (Target, Toys-R-Us, Borders) gift cards are generally not safe because the numbers are not protected from view (or swiping) as open-loop cards are, in protective packaging. This makes it very easy for thieves to copy the numbers. They then monitor the card using the card’s support line or at the retailers website to check when it is actived. When it is activated, they encode the newly activated cards number onto a phony gift card and go spend all the money on the card. When the customer tries to use the card, it is drained of all value.

Even worse, hackers are starting to target gift card websites (such as described in this story), for instance, using brute-force to check number after number until they find one that is valid and clone a card to match it. That could be your card.

To protect yourself, check your cards value immediately after you buy it and then a few days later. If thieves are going to steal your cards value, it will typically be very shortly after you purchase it. Continue to check the balance regularly and spend than as soon as possible. As soon as you notice some abnormalities, report this to the store where you purchased your card and ask for a replacement.