Gift card scams triple since 2017: study

An in-depth investigative study by Better Business Bureau finds an increase in reports of scams involving gift cards.

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The average victim loses $700 to gift card scammers, according to a new report by the Better Business Bureau.

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Gift cards may be a perfect socially-distant present in the age of coronavirus, but they’re also the latest target for scammers.

That’s according to a new study from the Better Business Bureau, which found gift card scams tripled between 2017 and 2020, accounting for $275 million in losses during that period.

The average victim lost $700 to scammers, according to the study. And consumers over 65 years old were the most likely victims.

“If you’re asked to make payment via gift card for whatever reason, you almost certainly are dealing with a scam,” said Steve Bernas, president of BBB of Chicago and Northern Illinois.

Gift card scams now account for 25% of scams reported to the Federal Trade Commission, excluding scams related to online purchases, the report found.

Gift cards don’t carry the same protections as credit or debit cards, which means funds can’t be reimbursed, Bernas said. Also, the cards can’t easily be tracked.

In a typical gift card scam, the scammer tells the consumer to buy a gift card immediately and read the numbers over the phone or send a photo of the numbers.

One victim in Chicago reported responding to a voicemail falsely claiming to be from Microsoft that said they’d deduct $300 from their Office 365 account, according to BBB. The victim called the number and reached someone at a call center in India who he gave remote access to his computer.

The scammer then said he mistakenly typed $3,000 instead of $300 and said the only way to credit back $2700 was for the victim to drive to various stores and buy $2,700 worth of gift cards and give him the redemption numbers.

Many scammers pretend to be government officials or business colleagues and demand payment through gift cards, according to BBB. Other scam include tech support frauds, romance scams, fake check scams, prize/sweepstakes scams and online vehicle sales.

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