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Gift cards generally spark joy in consumers. They convey the promise of easy and convenient presents. But perhaps due to the popularity of gift cards, frauds concerning gift cards are also on the rise. With the popularity of online shopping skyrocketing, cyber criminals look at gift cards as a lucrative opportunity to target unwary consumers. Gift Card Scams may sound minor but affect an inordinately large number of people every year. The best defense against such scam tactics is to be aware of what gift card scams are and how they can affect you. IT Support Houston offers extensive resources on how to protect yourself against gift card scams.

What does a gift card scam usually look like?

Gift card scams, in general, always involve a tone of great urgency. They commonly ask the victim to send the money immediately. Malicious actors can do this in many ways including threats, emotional manipulation, and other high-pressure tactics. Once they have managed to convince the victim, they generally direct them to a particular store and ask them to buy a specific type of gift card – usually one from Amazon, iTunes, or Google Play. They will then ask you to deliver the card information and disconnect once the transaction is complete.

The Federal Trade Commission warns that malicious actors of this type can communicate with victims using call, text, or email. While there are virtually any number of stories that scammers may tell the victim, it generally involves some sort of emergency or financial trouble. Scammers can falsely threaten victims with dire consequences such as shutting down utility services, jail time and more. IT Consulting Houston has extensive resources on different types of scams including:

5 common gift card scams

Here’s how to spot the scams and avoid them.

IRS threats
In this type of very common gift card scam, the scammer pretends to be working with the IRS. They generally grill the victim regarding unpaid taxes and threaten the victim with jail time. Once the victim agrees to pay, the scammer will ask to be paid via gift cards from a specific retailer and demand the gift card numbers and PINs. What consumers need to be aware of is that the IRS always sends a letter about unpaid taxes (if any) asking the recipient to call an official number. They will never call, text, or email. More importantly, the IRS will not send you to jail for unpaid taxes or ask for it to be paid through gift cards.

Beware the bots
Gift card scammers also make use of bots. These can be harnessed to automate many of the online tasks that they need, such as, drawing out gift card balances of the victims. The bot or software application can be used to check through a retailers’ online gift card balance check systems. Once the bot identifies the cards that are active, the scammers can choose to either draw or sell the gift card’s information on the dark web. While there are few effective defenses against this kind of an attack, you should always use your gift cards at the earliest possible opportunity in order to minimize exposure to bot attacks. IT Outsourcing Houston can help retailers defend their stocks against gift card scams.

Stealing the numbers
Gift cards generally have a magnetic stripe that stores the unique gift card number on it. Scammers may use a magstripe reader to read the numbers on the gift cards. This is a particularly popular tactic used in Walmart Gift Card Scams Text. The thief generally accumulates the numbers of dozens of gift cards from stores like Target, puts the cards back, and calls the listed customer care number to know if the cards have been activated and know the balance. They can then easily use the balance to make their own purchases. Avoiding this scam requires people never to use gift cards from publicly displayed racks in retail stores.

Fake prize scam
This is probably the most recognizable form of scam for the common public. The victim gets a call, email, or text message from a scammer notifying them of a lottery or contest win. But before the victim can claim the prize, s/he needs to pay a redemption fee using a gift card. The victim is then directed to buy a specific gift card, and share the card’s number and PIN with the scammer. Consumers need to be aware of the fact that genuine lottery, sweepstakes, or business will never ask for a fee to claim a prize. More importantly, it is highly unlikely for you to win something when you never entered such a sweepstakes or lottery in the first place.

The power company dues
Threatening to cut core utilities, such as power lines, can have a profound effect on any intended victim. In this case, scammers pretend that you have outstanding dues for your power or water bill and the utility will be shut off – unless you paid them through a gift card. This scam is fairly easy to avoid as like all public authorities; the power company will contact you through a letter in case of outstanding dues. They will also not shut off your power or water without giving you plenty of time to meet your dues. They will also never accept payment through a gift card.

What if you’ve already been scammed?

If you are quick enough to spot the scam, you have a chance to call the gift card company and check if the card has already been processed. If not, you may be able to recover your money. You should also inform the store where you bought the gift cards and inform the police.

Scott Young

Scott Young

Scott Young, is the president of PennComp LLC, an IT Support Houston company. Being a CPA, Six Sigma Master Blackbelt, Change Management Certified and Myers Briggs Qualified, Scott’s expertise is reflected in PennComp as a leading IT company for computer services and network integration. PennComp utilizes Six Sigma methodologies and practices in their service delivery and offers state-of-the-art monitoring and management tools to their clients.