"Vanilla Gift" card issuer faces lawsuit over card-draining scam risk

A gift card issuer is facing a lawsuit over allegations it failed to make its popular prepaid cards less susceptible to a common scam.

The lawsuit, filed last month by San Francisco City Attorney David Chiu, alleges Incom's "Vanilla Gift" and "One Vanilla" non-reloadable cards featured "insufficient" packaging and "lax security features" that made them susceptible to scams. 

According to the complaint, the gift card packaging allows for "easy access to the card inside,'' enabling thieves to record the barcode and PIN information so they can make unauthorized transactions, a practice known as card draining.