Scammers cash in on gift cards

Gift cards are increasingly the payment method of choice for scammers, with Scamwatch reporting more than $5 million was lost in 2018, a 38% increase compared with 2017.

iTunes cards accounted for $3.1 million in losses – a 156% increase from the $1.23 million reported in 2017. However, Scamwatch has also reported an increase in other gift cards such as Google Play, Amazon and Steam cards, and Australia Post Load & Go prepaid debit cards.

Losses to scams where non-iTunes gift cards were used as payment increased by 530% in 2018 to around $1 million.

“Scammers like to get gift cards as payment as it’s easy for them to quickly sell them on secondary markets and pocket the cash,” ACCC Deputy Chair Delia Rickard said.

“It’s concerning that the scammers are not demanding payment in other forms of gift cards. This is likely in response to scam warnings about using iTunes cards for payments.

“It’s clear the scammers are diversifying their payments to try to get around these warnings, so it’s vital people are aware that no legitimate company or government agency will ever ask you to make a payment with any sort of gift card.

Several common types of scams involving gift cards include:

  • ATO impersonation scams

The scammer pretends to be from the Australian Taxation Office and claims there is a warrant for the victim’s arrest. The scammer asks the victim to pay an immediate ‘fine’ using gift cards or bitcoin, and claims police will arrest them if they don’t pay up.

  • Catch-a-hacker scam

The scammer calls and pretends to be from a law-enforcement agency or internet provider and convinces the victim they are trying to trace the location of a hacker who has compromised the victim’s computer. They claim they can do this by sending money from the victim’s bank account or via gift card serial numbers.

Victims are also tricked into giving personal details with the promise of gift cards. Scammers entice victims to participate in surveys by promising gift cards as a prize, however, the surveys extract personal information such as name, date of birth, address details and even financial details such as credit card or bank account numbers.

“If anyone asks for payment using a gift card, it’s a scam, simple as that,” Ms Richard said.

“If you’ve paid a scammer with a gift card, report it as soon as possible. Call the company that issued the gift card and tell them it’s been used in a scam. It’s very difficult to get your money back but the sooner you report it, the better your chances.”

Businesses that sell iTunes, Google Wallet and similar gift cards are encouraged to inform their staff about these scams, so they can help warn customers.

People can also make a report on the Scamwatch website, or find more information about where to find help

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