The SMART2 forum is facilitated by the Euro Banking Association (EBA). The paper on the fraud potential of gift cards seeks to raise awareness of the different abuse scenarios and help reduce fraud in the future.
The recommendation note on the optional pan-European fraud information field for the SCT Inst Scheme explains why a field that allows to share contextual information about a payment transaction between the originator and beneficiary PSPs would be helpful and how it should be used.
Many of the regulatory restrictions put in place for anonymous cards only apply to ‘general-purpose’ or ‘open-loop’ cards; they do not cover ‘closed-loop’ cards or other limited-purpose tokens, which have been issued for use in a specific environment. Closed-loop cards and tokens are an ideal instrument for criminals to cover up their tracks when laundering money or defrauding victims of their funds: the conversion of funds into gift cards generally makes it impossible for PSPs to follow and claim back their customers’ money.
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