Visa Defeats Class Action Over Gift Card Scam Claims

Visa successfully defeated a proposed class action lawsuit alleging it failed to warn consumers that its prepaid Vanilla gift cards could be drained by thieves. U.S. District Judge Gregory Woods ruled that it was unreasonable for consumers to expect gift cards to be impervious to scams or that the presence of the Visa logo guaranteed protection against fraud. The judge also dismissed claims that Visa inadequately warned about tampering risks, citing widespread public awareness of "card draining" scams through news coverage and online discussions. The lawsuit, filed by a consumer who experienced gift card theft, accused Visa and card issuers of deceptive marketing and failure to compensate victims. Visa's legal victory has not only cleared it of these allegations but also coincides with positive market outlooks, as analysts forecast an upside potential for Visa's stock based on its strong performance and brokerage recommendations. The case highlights ongoing concerns about gift card fraud methods, including card tampering and online attacks, which continue to affect prepaid card users.