Protect yourself from gift card scams.

How do gift card scams work?

The Federal Trade Commission opens in a new window says most gift card scams don’t occur in-person. They’re most likely to be initiated over the phone, text, email, or even through a social media message.

Scammers will use different stories about why they need a gift card payment. Some popular stories the FTC notes include:

• Claiming to be from the government and back taxes or a fine are owed.
• Saying they’re from a tech support company and that there is something wrong with your computer. They will tell you that the computer can be fixed by paying using gift card.
• Pretending you won a prize, but that fees need to be paid via gift card before the prize can be claimed.
• Pretending to be from a utility company and threatening to cut off service if they aren’t paid with a gift card.
• Making a connection with you on social media and chatting with you to earn your trust. Eventually they ask for money and say you can give it to them on a gift card.
• Making a payment for an item you have for sale with a check for more than the item’s price. They will tell you to deposit the check and refund the difference with a gift card. The problem is that the check they sent is fraudulent, and you won’t find out until long after the gift card has been sent back.

“Normal and valid businesses don’t ask to be paid with gift cards,” said Jeanna Hoefferle, systems support and data analyst with consumer servicing, bankcard fraud, Commerce Bank. “They tend to make you feel pressure, threaten or rush you. This is so you don’t have time to think or concentrate on what they are asking you to do. Scammers prey on your emotions.”

There are three tactics most scammers use when convincing you to give them a gift card:

• Urgency — Scammers will tell you that there is an immediate need for a payment in the form of a gift card. The scammers want you to act before you have time to think.
• Direction — The scammers will tell you exactly which store to visit to buy a gift card (or sometimes multiple gift cards). Sometimes they will tell you to visit several stores and make several purchases to avoid a cashier who may ask questions.
• Proof — Scammers will ask to see photos of the front and back of the gift cards or ask for the full card and PIN number of each card purchased. Sometimes they will say they need the information as “proof” the cards were bought. Other times they may ask you to send them the physical gift cards.

“Gift cards are just what it sounds like a gift, they are meant to given in person,” said Hoefferle. “Gift card information on the back of the card is covered for the protection of the gift giver and only the gift recipient should expose the scratch code on the back.”

How to protect yourself from gift card scams.

The most important tip is to remember that gift cards should only be used as gifts. Never use a gift card as payment to anyone for anything.

Avoid purchasing gift cards from websites or stores you’ve never heard of before. Only buy gift cards directly from the stores they’re for. Gift cards that come from third parties run the risk of being fake or stolen from someone else.

Most gift cards have a protective sticker covering part of the card number or PIN number. Before purchasing a gift card from a store, inspect the gift card for tampering. If something doesn’t look right, turn it over to store management and select a different gift card to purchase.

Take a photo of every gift card you buy, along with the receipt. Keep these photos until the gift card has been redeemed. If there is ever a problem with the card, you will have a record, which makes reporting fraud a little bit easier.

Hoefferle has four important tips to stay safe from gift card scams:

1. Always trust your instincts.
2. Be cautious of unsolicited phone calls. You can always call a merchant back to check if they are valid.
3. If someone is asking for money or claims to be in trouble, verify those claims before acting.
4. Don’t buy gift cards on websites like Facebook Marketplace or other resale sites. Always purchase directly from the merchant.

What to do if you become a victim:

While it can be hard to recover money from a gift card given to a scammer, there are three things the FTC says you can do if you become a victim:

1. Call the company the gift card was purchased from right away. Use the FTC’s “How to Contact Gift Card Companies” opens in a new window tool to find contact information from some popular retailers.
2. Ask the gift card company for your money back. Sometimes retailers will grant your request.
3. Report the fraud to the FTC through reportfraud.ftc.gov opens in a new window.
4. Contact your bank.

“It’s important to contact your bank immediately as well as the merchant you purchased the gift cards from because they may be able to give additional information about next steps,” said Hoefferle. “The merchant may also be able to stop or cancel gift cards if they have not been used yet.”

Like with most scams, the most important piece of advice to keep in mind is to trust your gut. If you are contacted by someone you do not know and they ask you for a gift card — for any reason — stop and ask yourself, does this make sense? By slowing down and thinking before acting, you can protect yourself and your finances.