Our readers have received over 1 MILLION Nectar reward points worth £7,500 so far this year…

More than a million Nectar reward points have been stolen from This is Money readers so far this year, as fraudsters continue to target one of the country’s biggest loyalty card schemes.

We first highlighted the issues with the Nectar points rewards system over a decade ago, but earlier this year we wrote again about some of the loopholes within the system.

Since then, a flood of readers have contacted us to say that they too have had their points stolen.

Nectar owner Sainsbury’s says that while it will refund points in the event of fraud (and has done so for most of our readers), this affects only a small proportion of its 18 million members.

However, we estimate that 1,137,732 points have been stolen from our readers this year, equivalent to over £7,500, showing just how lucrative this scam is for criminals.

We analyze some of the main trends we have detected in relation to the Nectar scam.

1. Scammers can spend points without a physical card

The only common thread running through the Nectar scam is that criminals don’t need to have the physical Nectar card, or even have it on their phone, to spend points.

One of our readers, James*, had £370 worth of Nectar points stolen in January, despite carrying the physical card with him at all times.

Fortunately, Nectar responded quickly by issuing a replacement card and restoring her previous balance plus bonus points.

All other readers who have been in contact with This is Money have said that they too have had their points stolen while they still possessed the card.

There have been several theories shared online that go some way to explaining how the criminals could spend points. Understandably, Nectar is not sharing how it thinks the scam works.

Unlike a bank card, a Nectar card has no chip or secondary authentication, meaning criminals can theoretically duplicate a card’s barcode.

2. Criminals will use their Nectar points throughout Britain

Since scammers don’t need a Nectar card to steal points, our readers have reported that their points are being spent miles away from home.

One reader, Suki, who lost 44,000 points, said she spent her points at a Sainsbury’s in Fallowfield, but that she usually shops in Wilmslow or Macclesfield.

Others have reported their points being spent in places much further afield. One reader living in Cheshire said they had spent 11,500 points in a store in Edgware, London, while another said they had spent 14,000 points in Sydenham while they were at home in Bradford.

One reader said they discovered they had been robbed of almost £250 in four transactions made in Manchester, despite living in South Wales and having never visited the city.

3. Enfield gas station is a meeting point

The stores our readers have spent their Nectar points at are located across the country, with the majority in the Midlands and South East.

However, we can reveal that the Enfield petrol station has become a hotspot for Nectar Points theft.

We first wrote about using Nectar points in-store at Sainsbury’s back in January, when our reader James* said there had been three large transactions in Enfield, as well as two smaller ones in Hackney, east London.

James lives over 100 miles away in Gloucester and was not in London that day.

Two days later, she called the store in Enfield to ask if they could check their CCTV system to locate the thief, but was told she would need to speak to a manager, but was unable to get through.

Sainsbury’s has remained tight-lipped about the breach, saying CCTV footage in stores is stored for 31 days before being deleted and referring customers to police.

Since we published that article, several readers said they had seen transactions on their account at the same store and it is highly unlikely they were alone.

Although This is Money reported this to Sainsbury’s, they said they could not discuss their processes for detecting and preventing fraud without revealing useful information to criminals.

4. Your Nectar card may have a negative balance

Many Nectar customers save up their points to use on a big purchase later, meaning they can carry large balances and then spend the points.

However, some readers have reported that scammers have managed to spend the points they have accumulated and then left their account with a negative balance.

One This Is Money reader said he had gone from 18,645 points to -18,207 after fraudsters managed to gain access to his card.

5. There is no limit on points spent in a day.

One trend we’ve seen is the large number of points criminals can spend without the Nectar system flagging the transactions to customers until they review their account.

One reader said he lost over 400,000 Nectar points in one day without realizing it.

There doesn’t appear to be a limit on how many points can be spent in a day, which is understandable if customers want to make a large purchase, but no authentication is required to use the card.

Nectar is understood to have systems in place to detect when a customer’s account shows unusual activity, but this usually occurs after fraud has occurred during an investigation.

Banks often flag suspicious payments and will block the transaction until the customer approves it, so Nectar could introduce a limit on the number of points that can be used before an approval process is triggered in the app.

Have your Nectar points been stolen this year? Get in touch with us: editor@thisismoney.co.uk

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