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Redbox battles scammers

A video game-stealing scam has been brewing since Redbox based Oakbrook Terrace first introduced game rentals 2011. | File photo

A video game-stealing scam has been brewing since Redbox, based in Oakbrook Terrace, first introduced game rentals in 2011. | File photo

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Updated: October 23, 2013 6:24AM



After Bill Orechia rented a video game from a Redbox kiosk in Old Town, he opened his copy of “Street Fighter” to find not a disc, but piece of paper with a bar code.

“I got scared when I called [Redbox] because I thought I’d be charged the full $60 for the game,” said Orechia, 27. But “it was routine business for them . . . and they even gave me codes for two free rentals.” That’s because Orechia fell victim to a scam that’s been brewing since Redbox, based in Oakbrook Terrace, introduced game rentals in 2011.

Each Redbox disc has a bar code sticker that tracks customer credit card information, date of rental and more. But when users find a way to duplicate the bar code and place back it in the case, the kiosks are duped into thinking the game was returned.

It’s hard to pinpoint who’s to blame. “If you’re renter No. 1, then it’s obvious,” said Joel Resnik, vice president and general manager of video games at Redbox.

Redbox declined to say what percentage of customers have been affected by the scam, and Resnik wouldn’t elaborate on steps the firm might be taking to combat it. “If the problem was widespread it wouldn’t be a profitable business for us . . . but we are constantly looking at new ways to address these challenges,” he added.

Scammers might get away with a $60 video game as long as they’re not greedy and stealing dozens of games at a time, but Resnik views the thefts as a cost of doing business. Redbox charges customers $2 a day for a video game rental and has rented more than 3 billion DVDs or games since kiosks were introduced in 2002.

Redbox is operated by Outerwall Inc. Shares of Outerwall closed Friday at $46.29 and dropped almost $10 this week after management on Tuesday lowered future revenue expectations.



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