Scammers still use wire transfers and credit card numbers to fund their frauds, but cash-load PINS, like those used by Green Dot, have become the new preferred payment method.
The MoneyPak card you buy at the store is a deposit slip. It gives you access to that money via the 14-digit authorization code on the back.
“As soon as the victim gives the scammer that code, they use it to load all of your money onto their prepaid card,” explained Karen Hobbs at the Federal Trade Commission. “Then they can run to an ATM and get all of the money in cash or they go to an electronics store and buy things that are easily fenced. Once that money is offloaded, it is essentially irretrievable.”
Story by Herb Weisbaum for The Today Show.