The FTC’s latest Consumer Protection Data Spotlight report reveals that gift cards are the #1 payment method choice for financial scammers, contributing to a reported $148 million stolen from consumers. Scammers tend to contact individuals via phone or email, often impersonating a well-known business. The scammer will tell the consumer that in order to fix a security issue, the consumer must purchase a gift card and send a picture of the card to the caller.
Other versions of the scam include a demand for gift cards coming from someone claiming to be a work colleague, family member, or the Social Security Administration. Often, the scammer has a sense of urgency to their emails or calls, distracting the recipient from any apparent red flags.
According to the FTC Data Spotlight report, scammers are targeting Target gift cards, although Walmart, Google Play, Apple, and eBay gift cards are also popular. 30% of people who paid with Target gift cards report losing $5,000 or more. The Data Spotlight report also reveals that these scams have been on the rise every year since 2018.
The FTC has more resources for consumers about identifying a gift card scam. And remember: Gift cards are for gifts, not payment.
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