The holiday season is known for giving, sharing, and finding the perfect gifts for loved ones. However, as much as the holidays bring joy, they also provide opportunities for scammers to take advantage of unsuspecting shoppers. One of the most prevalent forms of fraud during the holiday season is the gift card scam. The Better Business Bureau (BBB) has issued a warning urging holiday shoppers to be extra cautious when purchasing gift cards, as scammers increasingly exploit this popular gift choice to steal money.
Gift cards are often seen as a safe and convenient way to gift something special, but they have become a favorite tool for fraudsters looking to exploit the goodwill and excitement that comes with the holiday season. This article explores the rise of gift card scams, how they operate, and the essential tips shoppers need to avoid falling victim to these fraudulent schemes.
The Growing Popularity of Gift Card Scams
Gift cards are a popular gift during the holidays because they offer flexibility and convenience. Whether it’s for a favorite retailer or a general-use card like Visa or Mastercard, gift cards allow recipients to choose exactly what they want. However, their widespread use also makes them an attractive target for scammers.
In recent years, the BBB has reported an increase in complaints and alerts related to gift card scams. According to the Federal Trade Commission (FTC), consumers lost over $200 million to gift card fraud in 2023 alone, a staggering amount that highlights the scope of the problem. Gift cards are now one of the most commonly requested payment methods for fraudsters because they are easy to use, difficult to trace, and can be quickly converted into cash or goods.
How Gift Card Scams Work
Gift card scams come in various forms, but the general approach follows a similar pattern. Here are some of the most common types of gift card scams:
1. Impersonation Scams
One of the most common tactics involves scammers impersonating a trusted figure, such as a friend, family member, or even a company executive. These scammers typically contact victims through phone calls, text messages, or emails, claiming they need gift cards for various reasons. The scammer might say they are in an emergency, like being stranded in another country, or that they are facing an urgent situation that requires immediate payment.
The scammer will often provide a sense of urgency, pushing the victim to buy gift cards as quickly as possible. They will then ask the victim to send pictures of the gift card numbers and PINs, effectively stealing the funds.
2. Tech Support Scams
Another common scam targets individuals who believe they are having technical issues with their computers or devices. Scammers often pose as representatives from well-known tech companies such as Microsoft, Apple, or Amazon, claiming that the victim’s system is infected with a virus or that their account has been compromised.
To fix the alleged issue, the scammer insists that the victim purchase gift cards and share the numbers as a form of payment. In many cases, the scammer may also ask the victim to grant remote access to their computer to “solve the problem,” which could give the fraudster the ability to steal personal information or install malware.
3. Online Shopping Scams
Scammers also use gift cards to prey on shoppers looking for deals on holiday gifts. They may create fake online stores, social media accounts, or websites offering products at incredible discounts. Once a shopper is interested in making a purchase, the scammer will insist that payment be made in gift cards rather than through more secure methods, such as credit cards or PayPal.
Once the gift card numbers are shared, the scammer disappears, and the shopper never receives the product they paid for.
4. Prize and Sweepstakes Scams
In this scam, the victim is told that they’ve won a prize, sweepstakes, or lottery. However, the catch is that in order to claim the prize, they must first pay taxes or fees using gift cards. These scams often come with promises of large sums of money or luxurious prizes, such as vacations or expensive electronics.
After the victim buys the gift cards and provides the codes to the scammer, they never receive the promised prize.
Red Flags to Watch For
The Better Business Bureau has identified several key warning signs that shoppers should be aware of to avoid falling victim to gift card scams:
- Urgency
Scammers will often create a sense of urgency to rush you into purchasing gift cards. They may claim that the situation is time-sensitive, and you must act immediately. Always take a moment to pause and assess the situation before acting on any request. - Unusual Payment Requests
If anyone asks for payment via gift cards, it should raise immediate suspicion. Reputable businesses or government entities will never ask for gift cards as payment. Gift cards are often used in scams because they are hard to trace and provide instant access to funds. - Requests for Specific Brands of Gift Cards
Fraudsters usually request specific brands of gift cards, such as Apple iTunes, Google Play, or Amazon, since these are easy to resell or use. If someone is asking for gift cards from specific retailers or brands, be cautious. - Unsolicited Communication
Receiving unexpected communication from someone claiming you’ve won a prize or are facing an urgent issue is a red flag. If the message seems out of the blue, contact the person or organization directly using a verified method, not the contact information provided in the message. - Vague or Evasive Responses
If you question the legitimacy of the request and the person becomes evasive, defensive, or overly pushy, it’s likely a scam. Legitimate businesses will be happy to provide clear answers to any inquiries you have.
Tips for Avoiding Gift Card Scams
To ensure that you don’t fall victim to a gift card scam this holiday season, consider these BBB-recommended tips:
- Be Skeptical of Unsolicited Requests
Always be cautious if someone you don’t know asks you to purchase gift cards. Whether it’s an email, text message, or phone call, scammers often prey on your good nature, hoping you will act without questioning their requests. - Verify the Source
If someone claims to be a friend or family member, contact them directly through a known and trusted method to verify their request. Similarly, if you are contacted by a business or government agency, independently verify the claim by reaching out to them through their official website or customer service number. - Use Secure Payment Methods
Whenever possible, opt for secure payment methods like credit cards or PayPal. These provide a level of fraud protection and can be disputed if the transaction turns out to be fraudulent. - Report Suspicious Activity
If you believe you have encountered a gift card scam, report it immediately to the BBB, the FTC, and the retailer where the gift cards were purchased. The sooner you report the scam, the better chance there is of preventing further fraud.
Conclusion
As the holiday season approaches, it is essential to remain vigilant against the increasing threat of gift card scams. The Better Business Bureau’s warnings serve as a reminder that while the holidays are a time for giving, scammers are also looking to take advantage of unsuspecting shoppers. By staying aware of the red flags, verifying suspicious requests, and using secure payment methods, consumers can protect themselves from falling victim to these deceptive schemes. Always remember: if something feels off, take a step back, and think twice before acting.
