Big gift-card purchases often hint at a scam
I’ve been getting a lot of calls about scams involving gift cards. Gift cards have become the currency of choice for crooks, scammers and extortionists. Denominations are available from $10 up to $10,000. They’re available at coffee shops, gas stations, supermarkets and many other retailers.
The first call came from a daughter whose mother, in her late 80s, lost almost $10,000 in one week to crooks.
It was a scam in which a young-sounding person calls from an out-of-state telephone number and identifies herself as the victim’s granddaughter. The caller goes on to explain in an upset, tearful voice that she is in serious legal trouble and needs her grandmother’s help by immediately sending lawyer fees or bail money to keep the “grandchild” out of jail.
A key element to this scam is for the grandchild to make the grandparent promise not to tell “mom and dad” or anyone else because the grandchild would get in more trouble or cause the parents extreme embarrassment in the community.
The target is then instructed to go to a merchant known to sell gift cards, purchase large denomination cards and quickly send them off using FedEx or UPS or other service for next-day delivery.
If the crooks are successful, once they’ve received the first gift cards they quickly call the victim again with a very convincing story urging the purchase of more and larger denomination gift cards. This pattern continues until the victim has maxed out his or her credit cards or realizes the scam.
Unfortunately, there is almost no recourse for the victim. Even if the gift cards have been purchased with a credit card, the purchase cannot successfully be “put in contest” with federal law.
Federal law allows the consumer to put a charge in contest for several specific reasons. The purchaser of the gift cards did in fact receive exactly what they intended to purchase — gift cards. What the consumer does with the purchased gift cards is not the business of the credit card company. The net result is the money is gone and not recoverable.
In this example the elderly lady lost a substantial sum of money.
My second story relating to gift-card scams has a much happier ending. A reader of this column called me and told me she had just come from the Rite Aid store in the Prairie Shopping Center in Hayden. She was waiting her turn in the checkout line. Another lady was attempting to purchase a bunch of high-dollar gift cards.
As the caller said, she couldn’t help but overhear the conversation between the woman at the register and the customer. The employee of Rite Aid was quietly explaining to the would-be purchaser of the gift cards that many scam artists are targeting their victims by telling them to purchase gift cards for payment.
The woman who overheard this conversation told me how gentle and sensitive the check-out clerk was in explaining the dangers of buying gift cards and sending them off to pay debts. Ultimately, the elderly lady was convinced and decided to not purchase the gift cards and instead talk with her family about the circumstances surrounding her “almost” purchase.
After hearing this story, I immediately called the Rite Aid store and talked with one of their senior employees. She explained that Rite Aid is very aware of the gift card scam and as company policy is always on the lookout for their customers attempting to make unusual purchases of gift cards. Checkout-line personnel are on watch for customers buying an unusually high number of cards or high-value cards.
Kudos to Rite Aid! Thank you for caring for your customers.
As a result of these two very different stories I am looking into initiating a program for all retail merchants in our area designed to head off scam purchases of gift cards and to educate checkout personnel, retailers, and consumers who are involved in point-of-sale transactions.
This could be an important and valuable service to the most vulnerable in our community.
LESSON: If anyone asks you to purchase gift cards to pay a debt or send money — IT’S A SCAM! Don’t do it.
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Changing subjects: What is RFID skimming? It is a form of digital theft, which enables information from RFID (radio frequency identification)-based smart credit or debit cards to be read and duplicated. It is used as a form of wireless identity theft or credit card information theft.
Thieves can scan every card in your wallet or purse by touching you or your possessions. A thief’s card scanner often looks as innocent as a smart phone or small tablet — the kind you see in every crowd being carried by many passers-by.
During summer months when people gather for events, especially in our beautiful home here in the Pacific Northwest, we become a target-rich environment for skimmer-scammers.
Fortunately, it is relatively easy to protect yourself from RFID skimming. Many wallets, purses or handbags are advertised as “RFID Safe.” Look for them. Use them. It may save you a lot of grief, money and trouble.
Due to space limitations I can’t detail all the cases I’ve worked on in the past couple of weeks. I will be detailing many more on the blog. I try to choose the cases to write about based on the number of calls I get and the amount of money involved. If I haven’t used your case, please understand and continue to call me.
See my blog for detailed information on RFID skimming and how not to become a victim. The “No Solicitation” high quality window stickers are now available. Go to www.cdapressconsumerguy.com.
I have many more interesting cases that I’m working on as The CDA Press Consumer Guy. Call me at (208) 449-7222, email me at CDAPressConsumerGuy@gmail.com or fax me at (866) 362-9266. Also include your full name and a phone number. I am available to speak about consumerism to schools, and local and civic groups.
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Bill Brooks is the CDA Press Consumer Guy. He is an active associate real estate broker for Tomlinson-Sotheby’s International Realty in Coeur d’Alene.