Jeff is a really generous boss. This past holiday season, he gave out $100 gift cards to various stores as gifts to his staff. He picked them up at one of those gift card malls that you see in grocery and drug stores: in this case, at grocery chain Ralph’s. When his employee went to actually use the card this week, it wouldn’t work. Normal gift card snafu? No. The grocery store blames card-switching thieves.

Curious if you’ve run across this issue previously. For Xmas, I purchased gift cards for members of my staff. To make life easy, I went to Ralph’s and purchased gift cards for Bed, Bath and Beyond, Home Depot and Best Buy. I happily handed them out and figured that was the end of it.

Two days ago, one of my employees humbly pointed out that the Best Buy card for $100 (yeah, pretty generous huh!) did not work at Best Buy. Frustrated, I went to Ralph’s tonight to sort it out.

The manager suggested I call their 800 number to sort it out. I insisted that he call them for me (figuring it would be a frustrating call). I was right. After about 25 minutes on the call, the customer service person for Kroger (parent company of Ralph’s) explained that most likely I was a victim of fraud. Puzzled, I asked to speak with the customer service rep on the phone to clarify. The rep said that thieves will take the original gift card and replace it with a fake (or different one). They keep the original one and then when a customer like me buys the card, they apparently scan the gift card holder (which apparently has the original number) and that activates the (now stolen) card. Of course, the card I left with is never activated.

The rep finally said they would open a case and I should hear back in 3-5 days and possibly they will send a replacement card. I don’t have a tremendous amount of faith in this, but will wait and see.

What frustrated me was:

1) their insistence that I was a victim of fraud. Actually, I bought merchandise from them and they should stand behind this. They sold it. It’s not like I bought the card off of ebay or craigslist!

2) The fact that they are aware of this problem and totally acknowledge it is frustrating. Why not keep the “real” cards behind a desk or locked up to help prevent this. They can still have your ugly displays, just do what Costco does and have the real thing in a safe place.

3) Stand behind your product. I should have been refunded there on the spot. They had all the info to confirm my purchase and admitted that. But that’s not their process. Instead I now need to wait for a replacement (if it comes).

What I’ve learned is to never buy gift cards from a supermarket or big box store, but rather only from the actual store that I (or whoever will get the card) am going to use the gift card at. I’ll suffer through a trip to Best Buy to purchase that gift card because at least I’ll know that they’ll sell a real one and activate it properly.

Has anyone else had this issue? Just curious.

Want more consumer news? Visit our parent organization, Consumer Reports, for the latest on scams, recalls, and other consumer issues.