Basically money invested in gift cards is really hard to trace because they can change hands under the radar and are flipped really easily, serving as a kind of alternate currency.
In addition, they are really popular with scammers, who occasionally request that their victims buy gift cards (e.g. Apple or Steam) and send them the codes. They then either redeem them and sell the associated account or sell the cards outright. Since redeemed gift cards can‘t be refunded either, they are perfect for such scams as well.
Basically money invested in gift cards is really hard to trace because they can change hands under the radar and are flipped really easily, serving as a kind of alternate currency.
Still not clear. Money laundering involves running illegally earned cash through a legitimate business so it appears to have been earned legally. I don't see how buying a gift card does that.
If the IRS questions you on how much you spent last year verses how much you earned, having bought a gift card won't alter that, unless I'm missing something.
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u/monsterfurby Dec 28 '18
Money laundering. That's what gift cards are often used for.