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How to Identify Online Gift Card Scams

By December 16, 2022January 10th, 2024No Comments
You’re not the only one who’s getting ready for the holiday season. Hackers and online scammers are anxious to set old and new swindling tricks. It’s that time of year when people are more giving and maybe more relaxed, so they forget to pay attention to details. 
One of the most popular ways to target online shoppers is online gift card scams. Sneaky cyber attackers will craft a fake online store that replicates the genuine one.  The most common brands that are impersonated include eBay and Amazon. Let’s say you’d contact a seller who markets a product you’re interested in, and you get a reply that says ‘only accept gift cards’, sometimes because they have a problem with your credit card. If you accept to offer a gift card, you’ve just given a fraudster an anonymous, untraceable gift card with usually weak fraud protection.
How to Identify Online Gift Card Scams

“Generally speaking, gift card fraud is easier to commit than other types of scams,” cyber security expert Rafael Lourenco, Executive Vice President of fraud prevention group ClearSale tells Yahoo Life. “In fact, for many merchants, gift cards have the highest fraud attempt rates of all products sold.”

This is because gift cards are so easy to resell or convert into cash, he says, and gift card transactions are so hard to trace.

Once a scammer gets access to your gift card, it can drain its value effortlessly.  But that’s not all! Gift card fraud can be a gateway to even more complex cyber fraud. In the worst-case scenario, thieves can move on to stealing your payment details, draining your bank account, and even stealing your identity.

Let’s take a look at how to identify online gift card scams.

Beware of bots

Gift card scammers often turn to bots to drain the gift card balances.

Hackers might use a bot called GiftGhostBot to scour retailers’ online gift card balance check systems. The bot is searching this system for gift cards that have been activated. When it finds one, the hackers use the gift card number to make purchases themselves or sell the gift card’s information on the dark web.  When you use your card, you discover that the balance has been drained and the gift card is useless.

How can you avoid this scam? Use your gift cards as soon as you receive them, giving bots less of a chance to discover your card information.

The online auction scam

You might be tempted to buy gift cards at online auction sites. Stay Clear! Cyber-criminals often sell gift cards that haven’t been activated at these sites. You may think you’re getting a bargain because you’re paying less than the card’s face value only to find that the gift card doesn’t work. 

Other scammers lie about the value of the gift cards they are selling online. They might claim that the gift card is for $150. You pay for the card, receive it, and find out that it only has $5 left in its balance.

How can you avoid this scam? Never buy gift cards from an online auction site. If you do want to buy gift cards online, buy them directly from the retailer offering them.

Fake prize

You might get an email or text message from a scammer claiming to be with a lottery or contest. This scammer says you’ve won a trip, a new car, or a load of cash. But to claim the prize, you must first pay a redemption or claiming fee with a gift card. The scammer asks you to purchase a specific gift card, call back, and read the card’s number and PIN over the phone.

No legitimate business will ask you to pay a fee to claim your prize. And you’ll never win a prize from sweepstakes or lottery you didn’t enter in the first place.

Still, wondering how to identify online gift card scams?  Ignore calls, emails or texts from anyone demanding that you pay for a fee, fine or other debt with gift cards. If you are buying gift cards for friends or family stick to reputable stores and check the cards for any signs of tampering (like the PIN showing on the back) before purchasing them.

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