A new data analysis by the Federal Trade Commission shows that gift cards continue to be the most common form of payment when consumers report losing money to most scammers.
Since 2018, the data analysis shows consumers have reported spending nearly $245 million on gift cards that they used to pay scammers for a wide variety of scams. Most often, consumers that use gift cards to pay a scammer are drawn in by an imposter scam. These can take on many forms, but the ones most likely to rely on gift cards as a payment method were government imposters, family imposters, business imposters, and tech support scams.
In these scams, the scammers convince consumers that they must pay using gift cards. The reasons they present vary, but they always come back to the idea that a consumer must go to a retail outlet, purchase physical gift cards, and then provide the PIN numbers on the cards to the scammer. Reports suggest scammers favor certain brands of gift cards, and those change over time.
Because of the pervasive nature of these scams, the FTC is also rolling out a new campaign to partner with retailers around the country to help prevent consumers from being caught up by a gift card payment scam.
The agency has created new materials that retailers can place directly at the point of sale for gift cards—both on the racks where they are displayed and at cash registers. The materials are designed to stop consumers who may be in the process of buying gift cards to pay a scammer, raising key questions and reminding consumers that “gift cards are for gifts, not payments.”
The Federal Trade Commission works to promote competition and protect and educate consumers. Learn more about consumer topics at consumer.ftc.gov, or report fraud, scams, and bad business practices at ReportFraud.ftc.gov. Follow the FTC on social media, read consumer alerts and the business blog, and sign up to get the latest FTC news and alerts.