Presumably he pays with a credit card and does a chargeback two or three months after payment, at which point physical rewards have already been shipped. Most payment processors will hold a reserve for a set amount of time for this exact reason.
Owe the bank 10 dollars, it's your problem.
Owe the bank 10 million dollars, it's their problem.
It seems the problem here I can use my CC for whatever, then months and months later do a charge back, even though I got what I originally paid for.
It sounds like the only defense would be to not ship the actual product (reward in this case) until the charge back grace period has elapsed.
Also, if the rewards are physical, surely that leaves a trail - they have to be sent somewhere.