Federal Trade Commission Says Gift Card Frauds Cost Americans $148 mln This year

Federal Trade Commission Says Gift Card Frauds Cost Americans $148 mln This year

The US FTC (Federal Trade Commission) recently disclosed that Americans lost $148 million to gift card frauds in the first three quarters of 2021, up significantly from the previous year. Over 40,000 consumers reported being scammed using gift cards as the payment method throughout the year.

The overall losses recorded in 2020 were less than the $148 million lost to fraudsters until September 2021. During the last three years, the number of reports of this scam payment has climbed year after year, reaching alarming levels in both the number of reports and the total amount of damages.

FTC said, “Since 2018, both the numbers of consumers filing reports in which gift cards were the form of payment to scammers and the amount they have reported lost have increased steadily.”

“The FTC has resources for consumers, including information on how to contact gift card companies to try to stop payments to scammers at ftc.gov/giftcards.”

While fraudsters have continued to ask for Google Play, eBay, Apple, and Walmart gift cards, they have recently turned to ask for Target gift cards, which is currently their most popular alternative.

According to the US federal agency, most gift card scams begin with a phone contact from someone posing as a government entity, such as the Social Security Administration, or a company. The caller may threaten to freeze your bank account and instruct you to purchase gift cards in order to escape jail or maintain access to your funds.

If you do not want to be a victim of a gift card scam, keep in mind that gift cards are meant to be used to get gifts, not to make payments. They are usually fraudsters if they call from a government agency or a bank and ask you to pay taxes to escape arrest or pay off an undisclosed debt to maintain access to your bank account.

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