This ‘gift Card Rip-Off’ Scam Is Out to Steal Your Christmas Money.
If you received gift cards for the holidays, don’t just throw them in a drawer and forget about them. While many gift card scams involve thieves demanding payment—from taxes and fines to unpaid utility bills—using prepaid cards, there’s a less obvious type of scam known as “gift card scamming.”
How gift card scams work to drain your balance.
If you’ve forgotten how much is left on a gift card you received some time ago, you’ll likely need to check the balance online. Typically, you’ll need to enter the card number and PIN or security code, but some websites that claim to provide gift card balance information actually collect this information for future reference. Always use the official website listed on the back of your card, or better yet, call or visit the merchant directly to confirm the balance.
In another version of this scam, scammers create websites offering cash for gift cards you don’t need or won’t use. They might claim to buy your $100 card for $90—which sounds better than nothing—but their real goal is simply to steal your card details and charge you, and you’ll never see the money. Websites advertising such deals are typically not legitimate.
When purchasing or receiving a gift card, keep your receipt, record the initial balance, and register it with the merchant. Alternatively, transfer the gift card funds to your existing account, if available. If possible, change your PIN and redeem the funds as soon as possible.
Gift card scams start at the store.
If you plan to purchase physical gift cards in the future, be sure to check them for signs of fraud. Fraudsters counterfeit cards in stores by placing stickers over the barcode, so that when you pay, the money is deposited into their account rather than the card itself, meaning the balance will be zero when the recipient tries to use it. Fraudsters may also record the card number and activation PIN or security code, then seal the packaging and return the card to the shelf. After payment or activation, they use this information to spend the funds.
Carefully inspect gift cards purchased in-store for any extra stickers, damaged packaging, or removed protective coating. You can avoid some risk by purchasing gift cards online directly from the seller’s website (gift cards sold at significant discounts on social media or deal sites are often scams).
If you do come across a fraudulent card, you can file a claim with the gift card issuer, although refund results may vary. The Federal Trade Commission (FTC) maintains a list of fraud contacts for some of the most popular gift card issuers, including American Express, Visa, and Amazon.