Criminals are constantly creating new ways to scam people out of money. While it is infrequent, gift card scams exist. Gift card fraud is usually less detrimental than credit card fraud or identity theft because it is limited to set amounts of money on the cards. As with many scams, there are things to watch for, so you can avoid becoming the next target of a gift card scam.
IRS Gift Card Scam
Gift card scams made the news lately because of the IRS Gift Card Scam. This particular scam involved a “robo-call”, where a scammer leaves an urgent message requesting a call back to settle their tax bill, often claiming it is their last warning. As this scam moves forward they often request payment via iTunes gift cards. Please note: the IRS will never ask you to pay a bill using a gift card.
This is one example of how an actual scam occurs. While you may think this won’t happen to you, it is always good to remain educated on what to watch for to protect yourself.
- Fraud calls and emails: The IRS and any reputable company will not request payment by gift card. If you receive a call requesting this– hang-up. If you receive an email – delete it.
- Card balance checking: If someone asks to listen to a call when you check the balance of a gift card, decline their request. Scammers can gather the information about your card and potentially steal or spend your funds.
- Reputable sales channels: Only purchase gift cards from reputable resellers or from the business where the card will be used. Many of these will offer quality customer service and money-back guarantees.
- Gift card packaging: When purchasing a gift card inspect the card and any packaging. If it appears damaged or tampered with turn it in and select another card. Scammers can collect card numbers or PINs to steal gift card funds.
- Activation receipts: Check your gift card activation receipt and confirm the numbers match the card and receipt. Mistakes happen and there are also reported instances where employees are part of scams that involved activating and switching cards.
Purchasing and spending gift cards is normally a simple transaction that goes smoothly. If you are using a closed-loop gift card, one that can only be used at a single business, the chances of being part of a scam lessen because their usage has limitations.
What to do if you’ve been involved in a gift card scam
Contact your local authorities if you’ve been the victim of any type of fraud or scam. They can address the situation and work to make sure it is stopped. You can also contact the company the scammer claims to represent, but make sure you use valid contact information. Do not use any contact information the scammer provided because that could just continue the misrepresentation.
The good thing about gift card fraud is that it normally limits the loss to the amount of money on the gift card that was compromised instead of your entire financial account information, identity, and savings. Also remember, while gift card fraud does happen it is more likely that your gift card use will go smoothly without any scams involved.