The sources are rarely stolen. I used to work in this area for a large e-commerce company and generally what happened is a retail partner would have a sale on gift cards (15% off or something like this), and organized people who did this for a living would buy up multiple thousands in discounted gift cards, often chaining other discounts to get up to 20-25% off.
In our case, the arbitrage operators would try to extract the money themselves by using gift cards to buy goods that retain value well (Apple products, gaming consoles etc) to resell. The company is taking a hit, but it's often not outright theft. Technically, they're just savvy customers.
As for this case, it sounds like he's buying from genuine wholesale distributors who get gift cards from below face value anyway.
Retail outlets would never agree to sell gift cards without clipping the ticket, therefore they aren't paying $100 for the $100 gift card they sell you.
This is a perfect example of the old adage, we lose on every gift card sold but we make it up in the long run.
Imagine,
Customer buys $100 gift card
Customer gifts gift card.
Recipient buys $89.99 worth of stuff
Recipient never returns to reclaim $10.01
Gift card expires
Company writes value of unused gift card off their books as profit.
There is a reason gift cards are popular, it’s a money making machine. There’s probably a stat out there but from memory 30% of the value of gift cards goes unclaimed.
In our case, the arbitrage operators would try to extract the money themselves by using gift cards to buy goods that retain value well (Apple products, gaming consoles etc) to resell. The company is taking a hit, but it's often not outright theft. Technically, they're just savvy customers.
As for this case, it sounds like he's buying from genuine wholesale distributors who get gift cards from below face value anyway.
Retail outlets would never agree to sell gift cards without clipping the ticket, therefore they aren't paying $100 for the $100 gift card they sell you.