Gift card companies are adding protections for consumers, who are increasingly being duped into sending funds to online scammers through store credit. In 2022, nearly 65,000 consumers were swindled out of more than $228 million in gift card scams, according to the FTC. "Did someone tell you to buy a gift card and give them the numbers? That's a scam," the Federal Trade Commission warned in a recent blog post.
Most recently, bad actors have been taking advantage of folks looking to contribute to Maui wildfire relief fundraisers . Criminals are seeking donations through phone calls and direct messages to social media. That's why it's important to only contribute through verified organizations. The FTC also warns consumers never to honor requests for money using gift cards. The agency advises anyone inclined to donate to do so using a credit card.
Those who wish to support Maui residents affected by the fires can help by supporting organizations active in relief efforts . The American Red Cross, the Hawai'i Community Foundation, Maui United Way and Maui Food Bank are among them. Other organizations, like the Hawaii Animal Rescue Foundation, are assisting by taking care of pets whose families have been displaced in the fires.
Gift card issuers are also stepping up efforts to combat this kind of swindle, in some cases enabling consumers to get their card funds back. "Some gift card companies are flagging fraudulent transactions and freezing stolen gift card money so that scammers can't get it. And those gift card companies want to give that money back," the FTC said in its blog post. Here are steps, highlighted by the agency, that consumers should take if they suspect they have been conned. First, report the incident to the gift card issuer, which is usually the company where the card would be redeemed like Amazon, Apple, Target, Walmart and others. Secondly, see if you can get your funds back, as some companies are flagging fraudulent transactions and freezing gift card funds. If a scammer has not yet drained the card yet, the company may be able to return funds to you, the FTC said.
It's important to be alert to tactics scammers use to deceive consumers, such as creating a false sense of urgency, using names that are very similar to legitimate charities, and seeking payment by gift card, wire transfer or cryptocurrency.
"No legitimate sale or transaction will require you to pay specifically with gift cards," the company said in a post highlighting some of scammers' tactics. Companies are echoing the same warnings as well. Amazon gift cards "should not be used to make payments to other businesses or individuals," Amazon added. The e-commerce site says that any of its gift card consumers who believe they've been scammed should contact its customer protection review team. Walmart also advises its gift card customers who think they've been the victim of a scam to report the incident to (888) 537-5503.
Megan Cerullo is a New York-based reporter for CBS MoneyWatch covering small business, workplace, health care, consumer spending and personal finance topics. She regularly appears on CBS News 24/7 to discuss her reporting.
