This Week in Dover

​By Evan R. Park

Gift card scams are on the rise, and Delaware lawmakers are taking notice with Senate Bill 280.

Nationally, the Federal Trade Commission logged more than 41,000 gift card fraud reports in 2024, totaling over $212 million in losses, with 2025 numbers expected to be just as bad.

Introduced by Sen. Bryan Townsend, Senate Bill 280 would amend Title 11 of the Delaware Code to create a specific crime for gift card theft. Under the proposal, someone commits gift card theft if they act with intent to defraud and:

• Take or keep a gift card (or the info needed to use it) without permission from the cardholder, issuer, or seller
• Tamper with a gift card or its packaging
• Run a scam to trick someone into handing over a gift card or its access information
• Use a gift card obtained through any of the above to get money, goods, or services

The bill defines key terms including "closed-loop" cards (usable at one store or chain) and "open-loop" cards (usable anywhere, like a prepaid Visa or Mastercard) and sets penalties under existing theft statutes (§841(c) and (d)).

Why does this matter for Delaware businesses?

• Retailers sell the product that gets exploited. Any business that sells gift cards — convenience stores, grocery chains, restaurants, big-box retailers — is a potential entry point for fraud, whether that's a scammer tampering with cards on a display rack or draining a card's value before it's even purchased.
• Customers blame the business first. When a customer discovers their gift card has been drained or stolen, the retailer or restaurant that sold it is usually the first call not law enforcement. Clear, enforceable criminal statutes give businesses something concrete to point to and can support faster law enforcement response, which helps protect customer trust and your brand's reputation.
• This bill would close a legal gap. Delaware currently relies on general theft and fraud laws that weren't written with gift cards in mind. This bill creates a tailored statute that's easier for prosecutors to apply, which could mean more successful prosecutions and a stronger deterrent effect.
• This bill could affect loss-prevention and compliance planning. Businesses that issue or sell gift cards may want to revisit how cards are displayed, secured, and monitored in stores, since clearer legal definitions of tampering and fraud could shape what "reasonable care" looks like going forward.

Overall, Senate Bill 280 has a low compliance burden, and a high upside. Unlike many regulatory bills, this one doesn't impose new paperwork, reporting, or operating requirements on businesses. It strengthens the legal tools available when your business or your customers are victimized.

Senate Bill 280 was on the legislative agenda for consideration Thursday June 25th, and the Delaware State Chamber is optimistic about its passage. 

*Legislation update as of 6/26/26: Senate Bill 280 passed. 

---