By Steve Earls, a seasoned cybersecurity leader who has innovated cybersecurity and risk management strategies at the CIA, Verizon Wireless, and Trane Technologies, is the Chief Information Security Officer overseeing LegalShield’s cybersecurity programs and teams.
With graduations, Mother’s Day, and a quickly approaching Father’s Day, this is a popular season of the year for gift cards. But did you know that you could be scammed out of your money just from buying a gift card?
According to the FTC Consumer Sentinel Network Data Book 2023, Americans reported 41,000 gift card scams in 2023. That makes gift card scams the seventh highest payment method scam in the U.S.! How can you ensure that your money is not going down the drain?
Let’s look at a common scam that involves nothing more than you simply purchasing a gift card. Whether you carefully select a card for that special someone, or you grab a quick card to fill out a long list of gift purchases, your new gift card could be worthless as soon as you get it. The money you spent on it is already gone.
How is this possible? Here are three common ways your gift card can wreck your wallet!
1. A sneaky cashier
Your cashier acting as the scammer is less common than other methods, but still a real possibility. The cashier can keep a stockpile of blank cards behind the register, so that when they scan the card you chose from the shelf and charge your card with your money, they swap it out with a blank. That means you leave with a blank and they keep your money!
This is a less common scenario because with today’s self-checkout and self-pay options, you can usually scan the card yourself. But if you do go to a cashier for your gift card purchase, make sure you get the right card back. They probably won’t be bold enough to try this swap if you’re watching, making eye contact, and conversing with them. But if you are on the phone or otherwise distracted, they may have no trouble swapping cards on you.
Even if you bring it back later, it will be difficult to prove anything happened. Your card won’t match the receipt, which means the store manager will likely think you are mistaken, or even suspect you of trying to pull a scam yourself!
2. Magnetic stripe readers
Bad actors sometimes enter a store, select a blank gift card, and use their own magnetic stripe reader to scan the card numbers onto a memory card. Then they simply put the gift card back on the shelf. The thief just has to check the number that they saved to see if you have bought the card and put a balance on it yet. Then they can spend your money before you do!
3. Bar code fakes
If a gift card has a bar code on it instead of a magnetic stripe, the scammer can use this as well. They purchase their own gift card and print that card’s bar code onto stickers. Then they can go back to the store and use their stickers to cover the bar codes on other cards. When you buy a sticker card and put your money on it, the scammer gets your money on their own purchased card instead.
Helpful tips to keep you and your money safe
- Maintain eye contact and pay attention to store employees who are handling the gift cards you want to purchase.
- Scammers are more likely to manipulate cards that are displayed in a spot far away from store employees. If you can, select your cards from locations that are within view of store personnel.
- Scammers are more likely to put impacted cards on the front of the rack so that someone will select them quickly. If you take your card from the back of the rack, there’s less chance that you’ll get one that has been tampered with.
Want a safer way to do your shopping? Go directly to the business you’re getting the gift card for, instead of visiting a general merchandise or variety store. You can also support small local businesses or “mom and pop shops.” They will be more than happy to get you a gift card. It will probably be something very simple like a piece of paper with a reference number for them to keep track of themselves. There’s no bar code or magnetic stripe to be compromised, and it’s never a bad thing to support small businesses!
You can also simply write a check as your gift and place it in a nice greeting card. Consider leaving a note to let the recipient know that you hope they’ll use the money for their favorite restaurant or their new hobby. That way, you never lose control of where your money went, and you have a record of when they cash your check.
However you choose to express your love for the special people in your life, it’s more rewarding if they actually receive your gift! Shop wisely to avoid experiencing the frustration of theft.
Pre-Paid Legal Services, Inc. (“PPLSI”) provides access to identity theft services through membership-based participation. IDShield is a product of PPLSI. All Licensed Private Investigators are licensed in the state of Oklahoma. The information made available in this blog is meant to provide general information and is not intended to provide professional advice, render an opinion, or provide a recommendation as to a specific matter. The blog post is not a substitute for competent and professional advice. Information contained in the blog may be provided by authors who could be third-party paid contributors. All information by authors is accepted in good faith; however, PPLSI makes no representation or warranty of any kind, express or implied, regarding the accuracy, adequacy, validity, reliability, availability, or completeness of such information.
