(NEXSTAR) – Gifts cards may be the perfect present for that hard-to-shop-for loved one, but they are also a favorite tool for scammers, according to a Better Business Bureau investigation that found a 50% jump in scam reports over last year.
“Today’s scammers want gift cards as payment, leaving those unaware of this tactic vulnerable to schemes designed to commit fraud,” the BBB writes.
Experts warn that people should think of gift cards like they do cash, because the funds are so difficult to trace once the card falls into the wrong hands.
Gift cards as payment
Whether it’s a phone call from someone claiming to work for the government or a someone selling an item online, if they ask for gift cards as payment it’s likely a scam, according to the FBI.
“The fraudsters use those funds to purchase goods and services, which may or may not be legitimate and you will likely never get reimbursed for those gift cards,” the FBI Washington Field Office warns. “This type of scam can be combined with additional requests for wire transfer payments and can be part of other complex fraud schemes.”
Similar requests can also involve pre-paid debit cards that scammers, often using fear and urgency tactics, convince the victim to buy, load up with cash and then hand over the redemption codes.
The following are warning signs, according to the BBB:
- Online vendors, businesses or governmental bodies asking for payment via gift card
- High-pressure calls alleging legal issues or overdue tax payments
- Requests for payment with an unrelated gift card for any service or item
- Anyone who asks for a gift card number or PIN over the phone or online
- Promises of check reimbursement
- Messages that appear to be from a work superior requesting gift card purchases
According to the BBB investigation and the Federal Trade Commission, gift card scams have netted at least $690 million since January 2020.
One victim, identified only as Richard, from Tempe, Arizona, told BBB’s Scam Tracker that he got a call purporting to be from Amazon about a suspicious charge on his account. The person on the other end of the line told him it looked like potential identity theft, and offered to connect him with someone from the government. The caller was convincing, and when he was asked to withdraw cash and convert it to gift cards to pay for the services he did, handing over several hundred dollars before he realized it was a scam.
In September, three Los Angeles residents were found guilty of laundering over $2.5 million in Target gift cards.
Posing as law enforcement or government employees, the scammers convinced unwitting victims that the only way to rectify nonexistent financial or legal problems was to buy the gift cards, often in increments of $500, and pay the caller by reading off the card numbers and access codes.
Also in September, a woman from China was convicted of running a counterfeit gift card scheme in St. Louis-area Target stores. Hongying Wang, 53, originally of Hunan Province, China, admitted to placing altered cards on Target shelves while retaining the access numbers, When the a gift card was purchased and loaded up with money, Wang would access the funds.
Target says it takes gift card-related crimes seriously and offers these tips for shoppers:
- Do not purchase, sell or check your balance outside of Target.com.
- Only check your balance on the Target site at https://www.target.com/guest/gift-card-balance.
- Do not purchase a gift card if it appears that the packaging has been altered or manipulated. If you have questions about a gift card, ask a Target team member for assistance.
- If you get a call from a stranger who says that a loved one is in trouble and they ask you to provide gift card numbers to help them, hang up and contact your loved one directly.
Amazon’s warning ahead of Black Friday
Amazon warned shoppers in an email of a pair of scams that it says have been especially prevalent in the second half of 2023, according to self-reported customer data.
“This time of year brings an increased risk that consumers may be impacted by fraud,” said Scott Knapp, director of worldwide buyer risk prevention at Amazon.
The first and most common is the email attachment scam, in which a crook sends a realistic email that appears to come from Amazon itself. The email, which often contains malicious attachments, threatens that one’s account might be suspended or put on hold and prompts the shopper to enter personal information, such as payment details or login credentials.
The second most common tactic targets Amazon Prime members. Whether via phone call, text message or email, the scammer will claim there is a pricy membership fee or problem with the account that requires the member to confirm or cancel the charge. The ruse is once again an attempt to trick shoppers into revealing personal information, such as payment or bank account information.
If you get a suspicious phone call, text message or email, experts advising contacting the company or agency directly via an official phone number or website. If it seems like it could be a scam, there’s a good chance it is.