Tis the Season for Holiday Gift Card…SCAMS

Gift cards are an easy and convenient solution to holiday gift buying, but they are also a popular way for scammers to steal money. The South Carolina Department of Consumer Affairs (SCDCA) is encouraging consumers to be on the lookout for gift card scams this holiday season.

“The most common red flag of a scam used to be a request to wire money or to put money on a reloadable card,” said SCDCA Administrator Carri Grube Lybarker. “Now scammers are turning to gifts cards when looking to separate consumers from their hard-earned money.” Gift cards are used like cash. Once in the hands of a fraudster, the money is gone and nearly impossible to trace.

There are several different scams where gift cards are requested, including:

     –IRS Scam. Claiming to be the IRS collecting back taxes or fees, scammers threaten arrest and more when asking for immediate payment.
     –Utility Scam. Pretending to be a utility company, the scammer threatens to cut off your power unless you pay your bill by gift card.
     –Lottery/ Sweepstakes Scam. These offers can come from a cold caller or show up in your mailbox or inbox. The scammer says you have won a prize – probably to a contest you never even entered – but first, you need to use a gift card to pay fees or other charges.

The IRS and utility scams are just two examples of impostor scams, where fraudsters pretend to be someone they aren’t to gain your trust. Grandparent and tech support scams are also common ruses. Since October 2013, SCDCA received 10 thousand scam reports, 43 percent of which were impostor scams making it the most popular scam type. Phishing scams came in second with 14 percent of reports and lottery/sweepstakes scams followed with six percent. The agency’s Identity Theft Unit (IDTU) Five-Year Anniversary Report also shows scammers were successful in stealing $5,192,964 from South Carolinians during the same time period.

If a consumer gets a call, text or e-mail asking for payment via iTunes, Google Play, eBay or other gift cards, know it’s a scam. Stick to buying gift cards for friends and family, not fraudsters. Those who paid a scammer with a gift card, immediately report it. Contact the card company and (1) tell them the gift card was used in a scam, (2) ask if they can refund your money and (3) tell them where you purchased the gift card.

To report a gift card scam or for more information on defending against scams call the IDTU at 844-TELL DCA (835-5322) or visit www.consumer.sc.gov and click the Identity Theft Unit tab.

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