 to the BBB Scam Tracker this year){kind=link}
MYRTLE BEACH, S.C. (December 14, 2023) – ‘Tis the season to buy gift cards. But beware, scammers are using them to defraud consumers. Better Business Bureau research shows more people reported gift card scams (fraud) to the BBB Scam Tracker this year, with a 50% increase compared to last year. Better Business Bureau serving Eastern Carolinas (BBB) wants to alert consumers of this scam and ways to avoid it.
Victims reported hundreds of millions of dollars in losses to BBB over the last few years, with about 3,918 total BBB Scam Tracker reports filed about gift card scams since 2020.
Gift card scam statistics in S.C. and N.C.
In BBB serving Eastern Carolinas’ service area, we’ve received reports of gift cards being used for payment in a variety of scam types, including tech support, imposter, and online purchase.
One 85-year-old in North Myrtle Beach, South Carolina used BBB’s Scam Tracker to warn others about a gift card scam involving Facebook Messenger.
“I was contacted via Facebook Messenger by a college classmate who I have not talked to in over 60 years. He told me that he had just received a government grant of $100,000. It was free money and did not have to be repaid.”
The con artist told him to contact an “agent,” who told him he qualified for the grant.
“He then asked me to provide an American Express gift card for $1,000 as the code of the gift card would prove who I was and allow me to receive the money.”
He did as they asked, but the scammers told him to provide another $1,000 gift card for “verification.” That’s when he realized it was a scam.
Another Scam Tracker report in BBB Serving Eastern Carolinas’ service area came from a consumer in Cary, North Carolina who was looking to purchase a puppy online after seeing an ad for it on Facebook.
“I texted with them for two days setting up the exchange of money for the puppy. I should have known something was wrong when I had to send a picture of the gift cards. When the delivery didn’t happen and I tried to get ahold of them, there was no number to call and they did not answer my text. I finally found a number online and that’s when I found out it was a scam.”
How the scam works
Scammers often persuade individuals to purchase gift cards by impersonating online sellers, work managers, pet breeders, tax agencies, or even government agencies such as the FBI. They frequently change their methods of getting consumers to pay with cards instead of money, making them hard to stop.
In most instances, scammers ask people to buy gift cards and send them the bar code and PIN on the back. Gift cards are essentially cash, meaning anyone who has the code can spend the amount on the card. Sometimes scammers ask for a popular brand (Apple Inc., Google, Target Corporation, Walmart, Best Buy) and other times they ask for a general-use card, such as a Visa Vanilla or American Express gift card. In both cases, scammers want the card number. In some cases the scammer might promise to reimburse the consumer later, however in reality, the consumer has lost the funds forever.
If victims ask why gift cards are being used for payment, scammers invent a plausible excuse, such as that the government has recently entered a contract with a gift card company to handle transactions.
“Like cash, gift cards do not carry the same legal protections as credit or debit cards, making it impossible for victims to recoup their money once they’ve paid with gift cards,” said Mallory Wojciechowski, president and CEO of BBB serving Eastern Carolinas. “If somebody is asking you to use a gift card for payment – don’t do it – it is most likely a scam.”
Red flags for potential gift card scams
- Businesses or governmental agencies requesting gift cards.
- Cold calls about overdue tax payments
- Paying for services or items with unrelated gift cards
- Online sellers requesting gift cards as payment
- Anyone asking to be sent a number or PIN over the phone or email
- Promises to be reimbursed through check
- A message from a work superior asking to purchase gift cards
BBB tips to avoid falling for a gift card scam
- Be on guard if anyone ever asks for payment through a gift card. Do not believe statements that buying gift cards is a safe payment method. Providing the numbers for a gift card is like sending cash, and the money is rarely recoverable. Gift card payment requests are a big red flag for a scam.
- Stop immediately if a person claiming to be from the government asks for a gift card. No government agency ever requests money through gift cards.
- Keep the receipt when buying a gift card. Keep the physical card as well. These may help prove that the card was paid for and activated if problems arise later.
- Inspect the card carefully before buying it to be sure it has not been tampered with. Some scammers open the card to get the numbers on the back so they can take the money when the card is later activated.
If you believe you are encountering a gift card scam:
- Contact the gift card seller, the organization supposedly asking for money, and BBB to ask whether you are encountering a scam.
- If you’ve been the victim of a scam, please report it to BBB.org/ScamTracker. Sharing your experience can help others avoid falling victim to similar scams.
For more holiday tips, visit the BBB Holiday Tips page.
About BBB of Eastern Carolinas
Better Business Bureau serving Eastern Carolinas is a 501(c)(6) not-for-profit corporation serving 48 counties in North and South Carolina. The organization is funded primarily by BBB Accredited Business fees from over 5,200 local businesses and professional firms. BBB promotes integrity, consumer confidence and business ethics through business self-regulation in the local marketplace. Services provided by BBB include reports on companies and charitable organizations, general monitoring of advertising in the marketplace, consumer/business education programs and dispute resolution services. All services are provided at no cost to the public, with the occasional exception of mediation and arbitration. Visit BBB.org.