Understanding and Avoiding Gift Card Scams

There are two types of gift card scams. Both are ways for those seeking payment to get their money using an untraceable method and providing no recourse for the consumer. If you are unfamiliar with these types of scams, this is how they work.

Pay Me With Gift Cards

Who are The Fraudsters?

  • Someone calls you to ask for payment saying they are from a reputable place such as the IRS, technology company, your credit card company or a utility company.
  • You may have hired them to provide work on your home like a roofer or fence installation.
  • They may be calling to tell you that you have “won” money or need money to help out a relative of yours.

What Do They Ask You To Do?

The person on the phone, will ask you to pay them using gift cards. Often times, they will remain on the phone with you while you go to the store or accompany you. Once you have purchased the gift card, it could be a generic card like a VISA gift card or a store brand, they will ask you for the gift card number and the PIN. Once you have done this, the money is now accessible to them to use online to purchase goods or use at Point of Service locations. If you recognize that this is the case, you can quickly get in touch with the company to see if you can get your money back.

 

Purchasing a Worthless Credit Card

Another way that scammers make money is to set up a website that sells credit cards. Sometimes these credit cards are stolen or have already been used. Only use reputable sites like the store’s website or better yet, purchase a card in person to be sure it is the real thing. Remember that gift cards are like cash. Once they are used, the plastic becomes useless to the person holding it in their hand.

 

For more information on gift card scams, you can also read this helpful article from the FTC by clicking here. If you think you may have been the victim of fraud, please register your complaint with the FTC.  While you may not be able to get your money back, it may prevent someone else from being scammed.