In Australia, an estimated $10 billion has been laundered by buying gift cards then distributing them or selling on the net at a discounted price. This happens in the US too. Gift cards are swell ways to launder relatively small amounts of money or to pay them while making it hard to track the money.
The primary goal is to separate the source of the purchase from its eventual use.
Often times the launderer will purchase gift cards with gift cards prior to withdrawing any funds in order to further separate the money from its criminal origin.
New regulations in the US are a bit feeble. Retailers have to report gift card transactions over $2,000 or $10,000 in the same day to one person. For drug cartels, this is just walking-around money, a pocket full of $1,000 gift cards to give to people or use for spending at restaurants. Obviously this doesn’t work with massive amounts of cash. But gift cards are an easy way to make money disappear and do tricks, especially, I suppose, if you control a pliant bank and own a gift card issuer.