If you’re being asked to make a payment by gift card you are almost certainly being scammed, the Better Business Bureau (BBB) is reminding people.
In a recent investigative study, the organization – spanning Canada, the U.S. and Mexico – found that losses from gift card scams nearly tripled from $1,179,563 in 2017 to $2,953,174 in 2020. The numbers reflect an increasing number of scammers cashing in on gift card popularity, especially during pandemic times.
“Gift cards don’t carry the same protections as credit or debit cards, so funds spent on gift cards are funds you cannot get back,” said Rosalind Scott, president and CEO of the BBB Vancouver Island.
In 2020, the median gift card loss reported to the BBB was $700, with the majority of victims being 65 or older. Typically, during a gift card scam, the fraudster will impersonate a government agency, business associate, tech support employee, romantic interest or seller to convince the target to buy a gift card and either read the numbers on the back of it or send a photo. To convince the victim, scammers may say the government has entered a new contract with a gift card company or may promise to reimburse them.
The Canada Anti-Fraud Centre received 2,702 gift card scam complaints in 2020, up from 2,301 in 2019 and 2,098 in 2018. According to the BBB, the most commonly requested gift cards include eBay, Google Play, Target, iTunes, Amazon and Steam, an online gaming company.
There are two main red flags the BBB says people should watch out for, including government agencies requesting payment, statements that buying gift cards is a safe way to make a payment. It also suggests people keep receipts from buying gift cards and inspect the card for any tampering before purchasing. Some scammers, the BBB said, will open the card and record the numbers on the back before they are purchased so once they are activated the scammers have access to it.
Anyone who has fallen victim to a scam can contact the issuer of the card, local police, the BBB, the Canada Anti-Fraud Centre or the Canadian Financial Consumer Agency.
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