How you can avoid gift card scams from Grinches when holiday shopping

December 14, 2022 10:52 PM

Arman Rahman,

Posted: December 14, 2022 10:52 PM

by Arman Rahman

MADISON, Wis.– It’s the most wonderful time of the year, when gift cards can serve as the perfect holiday gift. But if you’re not careful with where and how you buy them, you could be stuffing the stockings of scammers this Christmas.

“Gift cards are always the right size and color, they’re a great gift. They’re an easy gift,” said Tiffany Schultz, the Southwest Wisconsin Regional Director for the Better Business Bureau.

According to Schultz, more gift cards fly off store shelves around the holidays — but the one you pick up may have been tampered with.

“Scammers are notorious for opening the packaging, scratching off the numbers, recording those numbers,” Schultz said. “And as soon as you go ahead and purchase those gift cards they have emptied the gift card before the gift recipient can even get it.”

To get ahead of the Grinches, make sure the protective stickers are on the card, flip it around to check the pin number isn’t scratched off, and feel around the barcode for a fake one that may be stuck on.

Retailers and credit card companies are trying to help, too. According to Schultz, some registers only allow you to purchase $500 in gift cards without a supervisor override and some questions. Credit card companies are also calling or texting their customers, asking them if they made the purchase.

“Everybody is joining in this fight against fraud to help this gift card fraud, minimize (it), but it’s never going away,” she said. “Consumers really need to be on top of what they’re being asked for.”

If you receive a gift card, Schultz said you should see if you can register it (if it’s issued by a credit card company), and don’t let it sit unused for too long.

But the scams aren’t always just problems with plastic.

“(Everything from) receiving a phone call that your social security number has been kept compromised and they want you to pay by gift card in order to resurrect it, to receiving a notification that there’s been charges on your Amazon account, and in order to get those charges off your Amazon account, they want you to go ahead and buy gift cards so they can refund the money to it,” Schultz said.

In Stacy Faulk’s case, it was a letter in the mail asking her to be a Walmart store evaluator.

“I’ve participated in surveys and study groups like this before, but this is the first time that came across anything of this dollar amount,” Faulk said.

That dollar amount was a check for $2,575.

“And my job was to buy four Visa gift cards worth $500 each, and I was supposed to use that money of the check to buy those, and I would get the remainder, like $100 for gas and my time,” Faulk said.

While she believed it at first, she eventually caught on.

“It kind of threw a little flag at me like, ‘Oh, why are they trying to get gift cards? Where are they gonna use it for?’” she said.

But others haven’t been so lucky. In 2020, the BBB saw 985 gift card scam reports, costing victims a total of $2,953,174.

“They’re untraceable,” Schultz said. “There’s no way to track these gift cards. And once you have handed over the gift card numbers and the PIN number, your money is gone. It’s not recoverable.”

Which is why she said everyone should remember one thing: “Gift Card Payment usually equals scam, that’s a big red flag.”