About Gift Card Scams & Fraud Prevention

Gift cards seem harmless enough—from convenient last-minute presents to easy online shopping. However, gift cards are ALSO the perfect weapon for fraudsters, which may come as a surprise. But how can scammers steal money from gift cards without having a physical card? The answer is simple and happens often. Let’s explore gift card scams, their red flags, and fraud prevention tips.

What are Gift Card Scams?

The basic formula is simple: A scammer contacts you with an urgent problem or exciting opportunity that requires payment. Then, they pressure you to buy gift cards and share the PIN numbers over the phone, text, or email. Victims believe they are sending a trusted form of payment, so they comply. After receiving your information, the scammer immediately drains the card funds and disappears.

Fraudsters choose gift cards because:

• Payment transfers are fast and usually irreversible.
• They are hard to trace. Once the money is gone, you can’t get it back.
• Nearly anyone can buy or use gift cards (no ID or paperwork involved).
• They are widely accepted and easy to sell online for cash or goods.

In addition, there is a second version of gift card scams that doesn’t involve tricking victims into making payments. Instead, fraudsters steal money by tampering with cards in stores before they are sold. They record the PINs and wait for customers to purchase and activate the cards. Then, the fraudster drains the funds, leaving unsuspecting shoppers with worthless cards and wasted money.

Common Types of Gift Card Scams

Both versions of gift card scams can pose a big problem. However, the version involving card payments appears in many different forms and is more complex, which warrants more public awareness and education:

1. Impersonation Scams

Fraudsters pretend to be from the IRS, Social Security Administration, or your utility company. They may claim that you owe money immediately, otherwise or you will be arrested, your benefits will be suspended, or your power will be shut off. To resolve the issue, they demand payment in gift cards because they are easy to exploit and difficult to trace.  

2. Tech Support Scams

In this scenario, a pop-up warning appears on your computer that says you have a virus. Or, you could receive a call from someone claiming to represent a tech company. They offer to “fix” the problem…for a fee paid in gift cards, of course. These scammers make the issue sound urgent and legitimate, pressuring you to buy cards and provide the PIN quickly—before you have a chance to double-check the validity of the virus and credibility of the company.

3. Prize or Sweepstakes Scams

Exciting news! You won a prize, lottery, or sweepstakes…or at least that’s what you’re being told. Scammers take advantage of your excitement and hope in fake prize scams. Before you can claim your winnings, the scammer asks you to pay fees, taxes, or processing costs with a gift card. Once they receive the funds through your card number, the fraudster vanishes, and you never get your prize. 

4. Romance Scams

In this scenario, the fraudster pretends to be someone who has formed a close, personal relationship with you online. They create trust by acting like a romantic partner or close companion. After building the relationship, the love interest suddenly has an emergency and needs financial help. They ask for a gift card to quickly and easy way to send money before disappearing. Romance scams are particularly painful because they exploit emotional connections—not just financial ones.

5. Grandparent Scams

As the victim, you receive a call from someone claiming to be your grandchild or another family member in serious trouble. Maybe they have been “arrested” or in an “accident.” The caller seems upset or even cries, making it harder to hear their voice clearly. They claim to urgently need money but insist you can’t tell anyone else, which adds pressure and secrecy in the mix. As a grandparent, of course, you want to protect your loved one, so you act fast by sharing a PIN over the phone—only to find out that your compassion was weaponized by a scammer.

6. Employer or Boss Scam

This happens when you receive an urgent email or text that looks like it’s from your boss. The message asks you to urgently buy gift cards for a work-related reason (ex: client needs, employee rewards, business emergency, etc.). Even though it comes at an odd time or through unusual channels, the request seems official enough and you comply. After all, you don’t want to disappoint “your boss.”

7. Online Marketplace Scams

Scammers pose as buyers or sellers on platforms like Facebook Marketplace or Craigslist. They ask for payment via gift card, or they offer fake items in return for one. In the end, unsuspecting victims like yourself never receive the purchased item, and your money is gone.

8. Gift Card Resale Scams

Slightly different from the other types of gift card scams, an online resale scam involves selling gift cards below face value on auction sites/resale platforms. The cybercriminal claims the cards are discounted or unused. However, the reality is the cards are frequently obtained illegally, are already used, or have been depleted. Buyers think they are getting a good deal but instead end up with worthless cards.

How to Tell If It’s a Gift Card Scam

Scammers follow predictable patterns. Once you know what to look for, the tactics become much easier to identify. Here are the warning signs of gift card scams:

• You receive requests to pay bills, fines, or fees with gift cards.
• Someone tells you to buy a specific type of gift card or requests a specific dollar amount.
• There are demands for immediate payment (scammers use pressure tactics to cloud your judgement).
• You are asked to share a card number or PIN by phone, email, or message.
• The gift card looks tampered with, repackaged, or has stickers or scratch marks over the codes
• You encounter offers for heavily discounted gift cards online.

Remember, legitimate businesses and government agencies will NEVER ask for gift card payments. If someone does, it’s a red flag!

How to Protect Yourself from Gift Card Scams

Believe it or not, you have more power than you think. You can shut down fraudsters before they get close to your money. Just do the following:

• Stop and Verify: When someone demands immediate payment, take a moment and pause. If something is truly “urgent,” it can wait for verification.
• Buy from Reliable Sources: Only purchase gift cards from trusted retailers or official websites. Avoid buying cards from random online sellers.
• Contact Organization Directly: If someone claims to be from a company or agency, hang up and call the official number from their website (your billing statement works, too). DO NOT use the information the caller provides.
• Never Share Gift Card PINs: Treat gift card PINs like cash. Once it’s shared, the money is gone.
• Use Cards Soon After Purchase: The longer a card sits unused, the more time fraudsters have to steal its balance. Protect your money by redeeming the card and using it.
• Inspect Cards Before Purchasing: Look for evidence of tampering (like torn packaging or stickers covering bar codes).
• Trust Your Instincts: If something feels off, it probably is. Scammers rely on their victims second-guessing themselves.

What to Do If You Were Targeted by a Gift Card Scam

If you realize you have fallen victim to a gift card scam, take the followings steps:

• STEP 1 — Contact the Gift Card Company: Call the number on the gift card, which should take you to the retailer’s customer service. By reporting the incident quickly, you might be lucky enough to freeze the funds or get a refund.
• STEP 2 — Tell Your Bank: If you shared any financial information during the scam, alert your bank right away. Let them know what happened so they can monitor your accounts for suspicious activity.
• STEP 3 — Notify Local Law Enforcement: File a police report with your local department. This creates an official record that could be helpful if scammers are part of larger investigations or if you need to dispute charges.
• STEP 4 — Alert Federal Authorities: File complaints with the Federal Trade Commission (FTC) at reportfraud.ftc.gov and with the FBI’s Internet Crime Complaint Center (IC3) at ic3.gov.
• STEP 5 — Let People Know: Tell friends and family what happened. Your story could prevent someone else from falling for the same thing, and speaking up helps stop these criminals from finding more victims.

Final Fraud Takeaway

Scams involving gift cards are tricky because they play on urgency and steal money that’s hard to recover. For this reason, it’s especially important to pause, verify, and never act on pressure alone.

If you ever have questions about unusual requests or need help protecting your accounts, contact Academy Bank. Your security is our priority!

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FRAUD PROTECTION: Scams & Fraud; Prevent ID Theft; Report ID Theft; Fraud Alerts & Freezes; Mobile Security Tips; Visa Card Security.

SCAM-SPECIFIC RESOURCES: Most Common Scams of 2025; Payment App Scams; Package Delivery Scams; Mail Theft & Fraud Checks; Crypto Scams; Phone Call Scams; Email Phishing Attacks; Text Scams; SIM Swapping Scams; Payday Loan Scams; Pig-Butchering Fraud.