Do Not Become a Victim of a Gift Card Scam This Holiday Season

What do you want for Christmas? A new bike, a good book, or, perhaps, a day at a fancy spa? Whatever it is, the chances are that there is a gift card for it. People often feel uncomfortable giving gift cards as gifts because they might feel impersonal, but, in reality, that is what most of us want. According to a survey conducted by CashStar, 55%-61% (depending on the age range) of Americans prefer receiving gift cards to actual gifts. That ensures that they can buy themselves the book they want instead of receiving some cheesy best-seller novel that was picked up last minute at the check-out line. Without a doubt, that lifts the pressure off the shoulders of the “gifters” as well because they do not need to worry about buying and giving the wrong thing.

It’s all well and good until schemers mess things up. New gift card scams pop up every season, but if you continue reading this report, we hope that you will lower your chances of becoming a victim this year.

Schemers thrive in the gift card racks

Have you ever noticed those gift card racks at grocery stores, bookshops, and other retail locations? It’s very convenient to walk up to them and just pick up a few cards to fill the stockings or serve as main gifts. In the United States, the most popular gift cards come from Walmart, Target, Amazon, Walgreens, Home Depot, Lowe’s, Subway, Kohl’s, Costco, and VISA, according to The Balance Small Business. It appears, however, that schemers have their own favorites, and these come from iTunes and Google Play. In fact, according to FTC, 42% of schemers request iTunes and Google Play gift cards specifically. The FTC also warns that gift cards are schemers’ “favorite way to steal money.”

So, how exactly does that work? As we have mentioned already, schemers come up with new gift card scams every season, but some of them are proven to be more successful than others, and, unsurprisingly, we keep seeing them used time and time again. Although most people think of someone crouched over a computer when they hear the word “schemer,” when it comes to gift card scams, they are willing to go on foot.

It is crucial that you are extremely careful when picking up gift cards from the allocated racks in shops and malls. Why? That is because anyone can go up to them and mess with them. The goal for the schemer is to expose the PIN number/ID code of the gift card. In most cases, these codes are hidden from view, which means that schemers have to open the packaging and copy the codes. Once that is done, they can put the card back as if nothing had happened. Unfortunately, when someone buys the card that was tampered with, schemers can instantly use the balance to buy goods or services for themselves.

Can you imagine your loved ones trying to use the gift card and learning that it’s been emptied out? Happy holidays… That is why you MUST check the packaging very carefully to look for signs of tampering. If the PIN number/ID code is exposed, put the card down, and look for a different gift. Also, check for any suspicious stickers that schemers could add on top of activation codes to ensure that the money you put on the card is immediately transferred to their accounts instead of the card itself.

Gift card phishing scams

As you might know already, phishing scams are rampant these days. They can be used to introduce people to malware, extract personal information, and, of course, expose them to new gift card scams. Have you recently received an email suggesting that you can register for free on a website that can help you manage all of your gift cards and check their balances? Hopefully, you realize that this is a phishing scam and that by registering yourself and your gift cards on it, you will be allowing schemers to steal your holiday joy. Obviously, legitimate websites that check gif card balances exist, but fake ones exist too, and so you need to be extra careful about the ones you register on. Obviously, it is best if you check your balances using the official retailers.

Speaking of phishing scams and unreliable websites, have you ever tried to resell or exchange a gift card? Well, that is possible, but only if you use legitimate services. The last thing you want is to disclose your card PIN/ID/number and get nothing in return, or send a perfectly good gift card in exchange for one that was used already.

In a completely different kind of scenario, you might receive a phishing scam email suggesting that you need to pay for something and that the preferred method of payment is via a gift card. Schemers might tell you just about anything to ensure that their phishing scam works. For example, they could try to impersonate a utility company, trick you into thinking that you won a lottery (the gift card, allegedly, would pay for the handling fees), or even inform you that a family member has gotten in some trouble and that you need to bail them out. All in all, whatever kind of a phishing scam email you receive, remember that gift cards are not a form of payment, and the government, utility companies, the post, and other kinds of companies do not actually accept payments in gift cards.

Sextortion scams are becoming more and more popular too, and now you might receive a threatening email suggesting that compromising content will be made public if you do not pay using a gift card. Obviously, if you receive a message like that, you want to ignore it. You also want to ignore any suspicious phone calls that schemers could make in an attempt to make you purchase gift cards and disclose their numbers/PINs/IDs. This is a less common kind of a phishing scam, but it is the holiday season, and schemers are using every trick up their sleeve right now.

How to protect yourself against gift card fraud and phishing scams

If you want to protect yourself against new gift card scams and phishing scams in general, it is most important that you remain level-headed and vigilant. Remember that schemers can tamper with physical gift cards, set up fake balance-checking and resell & exchange websites, make phone calls, impersonate familiar companies or service providers, and even use blackmail (in sextortion attacks) to steal money using gift cards. So, what you need to do is pay attention, beware of phishing scams conducted via email or phone, choose reliable retailers over unfamiliar ones, and, of course, protect the gift cards in your possession.

Physical gift cards must be kept out of reach until they are used, and when it comes to digital gift cards, it is a good idea to store IDs/PINs/numbers and other identifying information somewhere safe. Cyclonis Password Manager is, as you can gather, a password management tool, but it can offer much more. Using its free Private Notes feature, you can store all gift card numbers until you are ready to use them. The tool will encrypt them and keep them under a lock until you are ready to treat yourself.

December 2, 2019

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