How to Avoid Gift Card Scams

We all know gift cards are the perfect presents for people who are hard to buy for.

But the only people I know who love gift cards more are scammers. They’ll create complex scenarios involving impersonating everyone from family members to the government just to get their hands on them. This is because it works for them. In 2023, they stole $217 million from gift card scams.1

Why are they so popular, and how do you know if the gift card from your Uncle Larry will work at the checkout? More importantly, how do you protect yourself when scammers ask you to pay a bill with gift cards? We’ve created this guide to help you answer all these questions and more. Consider it our gift to you.

How Gift Card Scams Work

Gift card scams usually start with someone contacting you via text, email, social media, or a traditional phone call. They’ll proceed with a long story on why they need you to send them gift cards – and they are not fussy about the brand. It could be Google Play, Amazon, or a prepaid credit card. Here’s how it generally plays out:

• An urgent request: Time is of the essence. You need to pay a fine or fee within 24 hours. They may also claim someone is in danger, and the only thing that will save them is a Walmart gift card.
• How to buy gift cards: The scammer gives instructions on how to purchase gift cards. You don’t need to walk into the store. They may send you to a website and ask for the details as you enter them.
• The number and PIN: You’ll be asked to hand over the card number and PIN, which are usually on the back of the card. This will give the scammer access to all the funds.

>> Learn More: What Is a Scam, and How Can You Avoid One?

The Most Common Gift Card Scams

Scammers have created many different scenarios to get their hands on gift cards. We’ve gathered some of the most popular ones that tend to trick victims.

Why Scammers Want Gift Cards

You might be wondering why scammers are obsessed with gift cards. In other scams, they usually want your personally identifiable information or bank account details so they can drain your savings. But there are a few reasons why gift cards are one of their preferred options:

• Accessible: You can buy gift cards online or at the local corner store. They’re available everywhere, so retail staff are not suspicious when people buy them.
• Easy to sell online: It’s just as easy to sell gift cards online as it is to buy them. Scammers sell stolen ones at discount prices to make higher profits.
• As good as cash: The Visa and Mastercard prepaid credit cards are accepted almost everywhere. Once the scammer has the card number and PIN, they can spend it immediately.
• Hard to trace: Retailers don’t capture the names of buyers or recipients. So once it’s stolen, no one can trace who used the funds on the card.
• Crypto-friendly: Scammers even use stolen money to buy cryptocurrencies. As we mentioned, Visa and Mastercard gift cards are accepted nearly everywhere, including crypto platforms.

>> Learn More: How to Prevent Being Scammed Online in 2024

What to Do if You’ve Been Scammed

If you’ve discovered you’re a victim of a gift card scam, there are steps you can take to minimize the damage. You may even be able to get your money back if you act fast.

1. Write down everything: Get the receipts for the gift cards and record the phone numbers or email addresses the scammer used. Try to write down anything you remember from the conversation that might be helpful to law enforcement.
2. Contact the gift card company: There should be a phone number to report fraud on the gift card. If there isn’t, call the customer support line. They may be able to block any money being spent on the gift card.
3. Report the scam to the FTC and law enforcement: Alerting the FTC and law enforcement might help stop others from being scammed.
4. Get identity theft protection: Be proactive in case the scammer has gathered other information and is using it for malicious purposes. The best identity theft protection services can scan the dark web for your personal details and lock your credit score so scammers don’t take out large loans in your name.

5. Scan your devices with antivirus software: If the gift card scam took place online, scan your phone and laptop with one of our recommended antivirus apps. It will check for malware or any suspicious downloads that might give scammers access to them.

6. Update your passwords: Change all your passwords immediately. Can’t think of something with letters, numbers and special characters? Use our password generator to come up with something scammers will never guess.

How to Protect Yourself From Gift Card Scammers

You don’t have to stop buying gift cards to protect yourself. We have some steps you can follow to avoid losing the funds.

The most important rule is to never answer suspicious calls or respond to unsolicited messages. While it might be tempting to pick up and feign interest, it lets the scammer know the phone number or account is active, and they will continue to harass you.

Another pro tip is to register the gift card with the retailer. When picking one out, make sure it hasn’t been tampered with; also, never activate it until it’s ready to be used. Hang on to the receipt as well. It can help reclaim stolen balances.

Finally, stay up to date with the latest phishing scams. We have lots of articles about how to spot them, as well as the entities scammers use to impersonate to steal your money.

Staying Safe Online

Scammers will do anything to get their hands on gift cards. Whether it’s impersonating the government to scare you or using AI to clone the voice of a loved one, they will continue to change their strategies until they get the funds.

It can be time-consuming trying to stay up to date on the latest scams. Trust us, we know. That’s why we recommend identity theft protection services and antivirus software. These products update their threat databases automatically so you’re always protected online.

>> Up Next: Geek Squad Scam: Everything You Need to Know to Avoid It