Scam Alert: How this new gift card crime targets online Christmas shoppers

Posted at 6:21 AM, Dec 04, 2015
and last updated 2015-12-04 06:23:13-05

RICHMOND, Va - 'Tis the season of online holiday shopping;  Reuters reports more than $3 billion in sales on Cyber Monday this year.  Big bucks means the search for big deals; however consumer experts are now warning of a new scam targeting online shoppers.

The Federal Trade Commission and Better Business Bureau said scammers have started requesting gift cards as payment for online purchases.  Here's what happens:

  • An online shopper finds a flat screen TV on a shopping website that offers great deals
  • All the reviews for the seller seem positive.
  • When the consumer goes to check out, though, the site asks the purchaser to buy an Amazon gift card and send the card's information as payment.

Experts said this is a tell-tale sign that something is up.  The scammers spend all the money on the gift card and never send the item the consumer thought they bought.

“It’s essentially mailing them an envelope full of money,” said David Newman with the Federal Trade Commission during an interview with CBS Boston.

Newman said crooks can easily create fake websites and demand gift cards, which are untraceable, as payment.  Many times, companies like Amazon cannot reverse gift card transactions, so once a shoppers sends the gift card information, they lose out on the money the spent to buy it.

The BBB said consumers can take several steps to protect themselves from these types of scams:

  • If the price seems to good to be true, there’s probably something wrong - Be wary if the item is selling for significantly lower than what you’ve seen elsewhere.
  • Beware of high pressure sales - Scammers want to get your money before you have time to think or get a second opinion on the deal.
  • Watch out for sellers who won’t take credit cards - Beware of sellers that requires you to wire money, use a prepaid debit card, or pay by gift card.
  • Check for legitimate contact information - Make sure the seller has a real phone number and address on the website, so you can contact them in case of problems. When in doubt, type the phone number into a search engine and see if it matches the seller, or if others have expressed concerns or filed complaints.
  • Make sure websites are secure and authenticated - Before you purchase an item online, look for “https” before the web address and a small lock symbol that ensure your credit card and/or banking information is secure.