SuperUser Account / Friday, November 15, 2024 / Categories: SmartMoney Tis the Season…for Fraud As much as the holidays are filled with joy, there’s no denying that gift-giving can be a challenge. Which is one of the main reasons why gift cards are so popular (one size fits all!). However, scammers are increasingly using a tactic called card draining to take advantage of well-intentioned gift givers. According to the Federal Trade Commission, gift card-related fraud including card draining cost consumers a whopping $217 million. Here's what you need to know about card draining and how to protect yourself. Card Draining: A Growing Threat Here's how it typically works: 1. Scammers use specialized readers to scan unpurchased card numbers from the display racks in stores. 2. They record the card information and set up an alarm that alerts them when the card is loaded with funds at the time of purchase. 3. Once a card loaded, the scammer drains the balance. If you’re not ready to abandon gift cards entirely, there are things you can do to avoid falling victim to card draining: 1. Purchase gift cards online from the official retailer website. Do not buy cards on eBay, Facebook Marketplace or other sites. 2. When purchasing cards in a retail location, only purchase cards that are kept behind the counter or in secure packaging. 3. Inspect all cards—even those in packaging—carefully for signs of tampering, such as a bar code that’s affixed to the card with a sticker, an exposed PIN, loose packaging, or misaligned stickers. 4. Use a credit card to pay for gift cards as this will boost the odds of getting a refund if you’re scammed. 5. Always keep gift receipts and provide them to the card recipient. 6. Encourage card recipients to immediately check the balance and, if possible, change the PIN. They should also be urged to use the card as quickly as possible. If your merry-merry giving takes a bah-humbug turn due to scammers, be sure to report the fraud the company that issued the gift card immediately and ask about a potential refund. You can also file a report with the Federal Trade Commission and the Massachusetts’ Attorney General. That said, there’s no guarantee you’ll receive your funds back from the retailer or your credit card company if that’s how you paid for the card. Avoiding scammers completely is difficult. But by following these simple precautions, you can better ensure your generous giving benefits the intended recipient. DISCLAIMER: This article is meant for educational purposes only and is not intended to be construed as financial, tax, investment or legal advice. Previous Article Preventing Gift Card Fraud Next Article The Best Time to Buy a Car Print 168
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