Gift Card Fraud

If you buy gift cards…use caution! Don’t judge the card by its package. Let me tell you about Kenneth.  He has two grandsons in another state that he does not get to see as often as he would like. So for holidays and special occasions he likes to send them a gift to say he is thinking of them. During Christmastime, he purchased a major brand gift card from a big box store and mailed it to his grandsons. Of course being so young, their mother was responsible for the gift card. Once, she opened the sealed packaging, she realized that her dad and sons had been scammed. A scammer took a photocopy of the original card’s barcode, affixed that to a different, worthless gift card, and put that into the packaging. Just with a quick glance, everything looked legit. Now all the scammer had to do was wait for money to be loaded on to it.  According to a unit chief with the Federal Bureau of Investigation, it is very easy for scammers to see when the gift cards are activated because they use computer software that constantly checks the card balance.

A couple of extra seconds spent looking at the visible barcode and Kenneth would have noticed that it was a fake.  How many of us actually take the time to flip over a sealed, intact cardboard package?  What about the stack of loose gift cards that stare at us while in the checkout line? How simple is it to grab a couple and copy the numbers? Once again, the scammer just has to sit back and wait for money to be loaded on it. Here are some tips to protect yourself and the recipient of your gift.

  1. Double-check the packaging. Does it look like it has been tampered with?
  2. Look at the barcode on the back. It should be shiny not dull.
  3. The FBI suggests purchasing the gift cards straight from the retailer online. Scammers do not have access to these cards.
  4. Avoid purchasing gift cards displayed in the open. If you must, chose one from the middle of the stack.
  5. Always keep your purchase receipt AND activation receipt just in case there is a problem. Ensure that the gift card number matches the one on your activation receipt.
  6. Reputable bill collectors, online sellers, law enforcement and/or government officials will NEVER ask you to pay via gift cards.

Source: Consumer Reports, Giftcards.com & CBS News

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