---
title: "Novi, Michigan shoppers get new protection as gift card fraud becomes felony"
url: https://www.herenovi.com/2026/10/06/michigan-gift-card-fraud-law-novi-shoppers/
date: 2026-10-06T05:27:44-04:00
modified: 2026-10-06T06:15:06-04:00
author: "Dashiell Vidal"
categories: ["Business"]
site: "HERE Novi"
attribution: "HERE Novi"
---

# Novi, Michigan shoppers get new protection as gift card fraud becomes felony

*Source: [HERE Novi](https://www.herenovi.com/2026/10/06/michigan-gift-card-fraud-law-novi-shoppers/) — October 6, 2026 by Dashiell Vidal*

Shoppers in Novi, Michigan, and across the state have new protection against gift card draining after Gov. Gretchen Whitmer on Monday signed bipartisan bills that make the scheme a felony under Michigan’s organized retail crime law.

House Bills 4598 and 4599 add gift card fraud to the Organized Retail Crime Act. Gift card draining happens when someone takes a card from a store rack, steals its redemption information and returns it to the shelf. When an unsuspecting customer buys and activates the card, the thief can drain the balance before the buyer uses it.

Under the new laws, the offense carries a maximum penalty of five years in prison and a $5,000 fine, plus restitution to victims. The bills define gift cards broadly to include both physical and digital cards, whether or not they have been activated.

The Michigan Retailers Association worked with lawmakers on the change. A retailers association official said placing the crime under the organized retail crime framework makes sense because the state already has a unit dedicated to investigating and prosecuting organized retail crime. Before the change, prosecutors had to rely on other statutes, such as criminal enterprise and fraudulent financial transaction device charges.

The official also said many victims never report the crime because they assume they simply bought a dud card or the amount was too small to pursue. Officials often cite Federal Trade Commission data showing more than $200 million a year in losses to such scams in recent years.

Whitmer signed the gift card measures as part of a package of bills on Monday.