How To Spot and Avoid Gift Card Scams

Last year, my aunt got a call from someone claiming to be from Amazon. They told her she had won some free items but would have to pay for delivery herself. Then they asked her to buy an Amazon gift card and send them the code to pay the delivery fee. Thankfully, she was suspicious and called me before doing anything. Of course, it turned out to be a scam, but many others aren’t so lucky. If you’ve ever found yourself in a similar situation or want to avoid becoming a victim, keep reading. 

Gift card scams are becoming more common, and they can cost you hundreds, sometimes even thousands, of dollars. ​In 2023 alone, Americans lost an estimated $217 million to gift card fraud.  

How do you avoid becoming a victim? By knowing what to look out for. In this article, I will show you how to spot gift card scams from afar and avoid them. First, let’s start with a few quick tips to help you get started. 

Quick Tips to Avoid Gift Card Scams

• Never share gift card numbers over the phone 
• Verify the source of any gift card request
• Keep gift card receipts
• Inspect physical cards for tampering
• Avoid clicking on suspicious links offering digital gift cards
• Report suspicious activity immediately

What are Gift Card Scams?

Gift card scams happen when someone tricks you into buying gift cards and sending them the card number and PIN. Once they get this information, they quickly use up the money, leaving you with nothing.

These scams often start with a phone call, email, or text message from someone pretending to be trustworthy, such as a government agency, utility company, or a friend. They usually create a sense of urgency, making you feel like you have to act fast. For example, they might claim you might say you owe money, have won a prize, or need to help a friend in trouble. Then, they’ll instruct you to buy specific gift cards and give them the codes. Because of this pressure, many people don’t stop to think before buying and sharing the gift card details.

Scammers prefer gift cards because they are easy to buy and nearly impossible to trace. Unlike credit cards or bank transfers, once the money is taken from a gift card, it’s almost impossible to get back.

Common Gift Card Scams and How to Spot Them

It’s not always easy to tell when someone is trying to scam you. Scammers know how to trick people into thinking their situation is real. But if you know what signs to watch out for, you can avoid falling for their tricks. 

Here are some common gift card scams:

1. Urgent payment scam
2. Prize or lottery scam
3. Friend or family scam
4. Online shopping scam
5. Deals and discount scam
6. Gift card code generator scam

The “Urgent Payment” Scam

You get a call, text, or email from someone pretending to be from the IRS, a utility company, or law enforcement. They tell you that you owe some money, and if you don’t pay right away, you will be penalized. The penalty may be your service getting cut off or your account being frozen. Then they insist you pay with gift cards to avoid the penalty. 

How to spot it:  No legitimate company or government agency will ever ask for payment with gift cards. So, if someone tells you to pay this way, it’s a scam. Hang up or delete the message.

The “Fake Prize” Scam

This scam is all about getting you excited. You’re told you’ve won a prize or a lottery, but first, you have to pay some fees or taxes using gift cards to claim it. The scammer may say this is standard procedure, but it’s a trick to get your money. A good example of this is what happened to my aunt. 

How to spot it: Real prizes or lotteries don’t ask for payment up front. If someone asks you to pay with gift cards to receive your prize, it is a scam. Block the number or report the message.

The “Friend or Family Emergency” Scam

This scam isn’t actually perpetrated by someone you know but by a scammer pretending to be a friend or family member. Usually, they might say they’re in trouble and need your help right away. They ask you to buy gift cards and send them the codes so they can get out of a sticky situation.

How to spot it: If someone you know is asking for help through gift cards, be suspicious. Contact the person directly to confirm if it’s really them. Scammers often fake being someone you trust to get you to act quickly.

The “Online Shopping” Scam

This scam happens when you try to buy something online. The scammer offers you a product at a good price but insists you pay with gift cards. Once you send the codes, the seller disappears, and you never receive the item.

How to spot it: Legitimate sellers usually accept regular payment methods like bank transfers, debit/credit cards or PayPal. If gift cards are the only option, then such a seller cannot be trusted.

The “Gift Card Code Generator” Scam

Gift card code generators promise to generate free gift cards for you but they may be scams in disguise. To generate the free codes, you’ll be asked to download software and enter some personal information. However, these codes are fake, and the software might infect your device with malware, stealing your data instead of giving you a gift card.

How to spot it: There’s no such thing as a legitimate gift card generator. If you come across a website or app offering free gift card codes, it’s a scam. Stick to official retailers, and never give out your personal details in exchange for supposed free codes

The “Tech Support” Scam

You get a pop-up on your computer warning you that your device has a virus. The message looks official and may even have a logo from a well-known company like Microsoft or Apple. The pop-up might tell you to click a link or call a phone number for “immediate help.” They say they can fix it, but you need to pay with a gift card.

Once they have that code, they disappear with your money, and your computer was never actually in danger.

How to spot it: Legitimate companies don’t send pop-ups that lock your screen or demand urgent action, nor do they ask for gift card payment. If you see one, it’s a scam. Close the browser or restart your computer.

Digital Gift Card Scams: What to Watch Out For

As online shopping and e-gift cards grow in popularity by the day, so do online gift card scams. Scammers are always coming up with new ways to trick people, so it’s important to be alert. Here are some warning signs you should watch if you purchase digital gift cards:

Suspicious URLs in Email Offers

You might receive an email claiming you’ve won a free gift card or that a retailer is offering a limited-time deal. The message will include a link to “claim” your gift card. However, scammers create fake websites that look just like real ones to trick you into entering personal information or payment details.

How to stay safe: Before clicking any link, hover over it with your mouse to see the real web address. If it looks strange or doesn’t match the official retailer’s website, don’t click. Instead, go directly to the retailer’s website by typing it into your browser.

QR Codes Leading to Unofficial Websites

Some scammers send QR codes through email, text messages, or social media, claiming that scanning the code will take you to a great deal. However, the code may actually lead to a fake website designed to steal your information or infect your device with malware.

How to stay safe: Never scan an unsolicited QR code without being sure of the source. If you’re unsure, visit the company’s official website instead of using the code.

Too-Good-To-Be-True Discounts

You see an online ad offering a $100 gift card for just $40. Sounds like an amazing deal, right? Unfortunately, scammers use fake discounts to trick people into buying fraudulent or stolen gift cards. Once you pay, you either get a fake card or nothing at all.

How to stay safe: If a deal seems too good to be true, it probably is. Always buy gift cards from trusted retailers like Nosh or official websites. Also, check customer reviews if you’re purchasing from a third-party seller.

Fake Customer Support Scams

Scammers may pose as customer service agents from major gift card retailers, claiming there’s an issue with your digital gift card. They’ll ask for your gift card number and PIN to “verify” the balance, but once they have that information, they’ll steal the funds.

How to stay safe: Legitimate customer service representatives will never ask for your full gift card number or PIN. If you receive a suspicious call or message, contact the company directly using their official website or phone number.

How to Protect Yourself from Gift Card Scams

Gift card scammers rely on catching people off guard, so the more prepared you are, the better. 

Here are some tips to help you avoid falling for gift card scams:

1. Avoid sharing gift card codes: Never share your gift card codes with anyone you don’t know or trust, no matter who they claim to be. Once you give someone the code, they can use the funds immediately, and you won’t be able to get them back.
2. Double-check before helping someone: If a friend or family member contacts you asking for help through gift cards, pause. Take a moment to call them directly or use another way to verify their story. Scammers often pretend to be someone you know to get you to act quickly.
3. Be wary of unsolicited offers: If someone contacts you out of the blue, claiming you’ve won a prize, lottery, or sweepstakes and asking for gift card payment, it’s a red flag. Real prizes don’t come with fees or taxes that need to be paid through gift cards.
4. Stick to trusted gift card sources: Always buy gift cards from trusted sources like official websites, reliable gift card trading platforms, or well-known stores. Avoid buying from third-party sellers, especially if they’re offering huge discounts. If the deal seems too good to be true, it’s likely a scam.
5. Don’t click on suspicious emails or attachments: Scammers often send fake emails pretending to be from trusted companies. These emails may have links or attachments that can steal your information or lead you to a scam site. Always verify the sender and avoid clicking on anything that seems suspicious. A good way to identify phishing emails is to check for spelling errors in the body of the mail. 
6. Verify URLs and check security: When shopping online or visiting websites related to gift cards, always check the URL to ensure it’s correct and secure. Look for “https://” at the beginning of the web address. If the site looks suspicious or the URL doesn’t match the official company’s website, leave the page immediately.

What to Do If You’re Scammed

If you realize that you’ve fallen victim to a gift card scam, it’s okay, don’t beat yourself up. Scammers can act fast, but you can still take steps to minimize the damage if you act quickly. Here’s what you should do:

Contact the Retailer

If you purchased the gift cards through a specific retailer, like Amazon or Apple, contact their customer service as soon as possible. Some retailers may be able to track or block the transaction if you act quickly, although recovering the money can be difficult.

Report the Scam to the Authorities

Report the scam to the Federal Trade Commission (FTC) if you’re in the United States. They collect information on fraud and can investigate the case. 

Notify the Gift Card Issuer

If you know which gift cards were used in the scam, contact the issuer immediately. While they can’t always recover the funds, they may be able to block or freeze the gift card balance to prevent further use.

File a Police Report

In some cases, especially if a large sum of money was lost, filing a police report may be a good idea. It can help protect you if someone tries to commit identity theft using your information, and it may help authorities track down the scammer.

Frequently Asked Questions About Gift Card Scams

1. Can I Get My Money Back from a Gift Card Scam?

Unfortunately, gift card scams are difficult to reverse. However, if you act quickly, you may be able to recover funds by contacting the gift card issuer and reporting the fraud.

2. How Do I Check if a Gift Card is Legitimate?

Inspect physical gift cards for signs of tampering. For digital cards, verify the source before purchasing and ensure the website is secure (look for “https” in the URL).

3. Which Retailers Are Most Targeted by Scammers?

Scammers frequently use gift cards from Apple, Google Play, Amazon, Walmart, and Target because they are popular and easy to resell.

4. How Can I Protect Myself from Digital Gift Card Scams?

To protect yourself from digital gift card scams, avoid clicking on suspicious links or downloading attachments from unknown sources. Additionally, always verify the legitimacy of a website before purchasing gift cards, and make sure the site is secure (look for “https” in the URL). 

Conclusion – You Can Stay Safe from Gift Card Scams

In conclusion, gift card scams can happen to anyone, but with the right knowledge, you can avoid becoming a victim. By recognizing the warning signs and taking steps to protect yourself, such as verifying requests and sticking to trusted sources, you can keep your funds safe. If you’re ever in doubt, always take a moment to double-check.

For peace of mind and a secure experience, be sure to buy your gift cards from trusted gift card platforms like Nosh. On the Nosh platform, you get different brands of gift cards at cheap prices and can also sell your unused gift cards at the best rates. Sign up now to start trading.