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Paying With a Gift Card

Paying With a Gift Card

When Scammers Request Payment with Gift Cards – Don’t Fall for It

Gift cards are practical, widely used, and easy to find. And they are not always used for gifts. One of the most common ways scammers give themselves away is when they request payment with a gift card. Gift cards are a popular way for scammers to collect payments. A Federal Trade Commission report found that $217 million in gift card-related fraud was reported in 2023 by consumers who filed complaints received by the FTC.

According to a 2022 AARP survey, 1 in 3 Americans reported that they or someone they knew had been asked to buy a gift card to pay a bill, a charge, or some other debt. In the United States, 13 million people aged 18 and older (or one in four of the adults surveyed) said they have purchased the cards when requested.

Why Gift Cards?

The reason gift cards are such a common way for criminals to request payment is their lack of traceability. Once a gift card is purchased, money is loaded onto them, and the card numbers have been given to the requestor, they are virtually impossible to trace.

Gift Card Scam Ingredients

Gift card scams, like most scams, typically contain these ingredients:

  • Urgent or secret requests;
  • Believable stories or connections;
  • Financial requests; and 
  • Unusual payment types like gift cards (to pay a “utility” bill or “warrant” or the “taxes” on a “sweepstakes win”).

How It Works

You get a call, text, or email informing you of a debt you know nothing about. The message says if you don’t pay immediately, something bad will happen. Maybe you’re told your electricity will be shut off or your Social Security benefits will be terminated, or you will be arrested for tax evasion. Then you are instructed to buy a gift card to pay the debt. According to the FTC, Apple cards are far and away the most common gift card that scammers request, followed by Target, eBay, Walmart and Amazon gift cards. You are told to provide the gift card numbers and card PIN to the requestor by phone, email, or by taking a picture of the card. This has all the ingredients of a scam. DON’T PAY!

These payment demands can come from someone claiming to be from:

  • A government agency. They might say they’re from the IRS or the Social Security Administration. They tell you need to pay back taxes or a government fine. Remember: government agencies will not contact you to demand immediate payment. And they will never demand payment by gift card.
  • Tech support. They claim to be calling from Apple or Microsoft. They tell you there’s something wrong with your computer and you need to pay to have it fixed. They instruct you to buy a gift card. They then ask for remote access to your computer. Don’t pay and don’t give them access. Not only will they take your money via the gift card, but they may also infect your computer with malware, allowing them to steal your personal and financial information.
  • A friend or family member with an emergency. The scammer could use artificial intelligence or voice cloning to sound just like your loved one. The phone number they’re calling from may also be cloned to appear to be your loved one’s number. The caller begs you to send money right away with a gift card and asks you not to tell anyone. If you’re worried, contact the friend or relative to make sure everything is all right.
  • A sweepstakes company claiming you have won a prize. But first, you need to pay fees or other charges with a gift card. No honest business or sweepstakes company will ever make you buy a gift card to pay for a prize. Ask yourself: Did you even enter to win that prize?
  • A utility company. They threaten to cut off your service if you don’t pay immediately with a gift card. But utility companies don’t accept gift card payments.
  • A dating website. First, someone chats you up on a dating site. Scammers are not above using the desire for romantic connections to trick you into buying gift cards to send them money. Never send gifts or money to someone you haven’t met in person — even if they send you money first.
  • An entity sending you a check for more than you expected. They direct you to deposit the check into your bank account and then purchase a gift card for the difference. Don’t do it. The check will turn out to be fake and you’ll be out the money for the gift card. Additionally, your bank will probably charge you fees for the counterfeit check.

What to do If You Are a Gift Card Scam Victim

If you purchased a gift card and gave the numbers and PIN to a scammer, the Federal Trade Commission (FTC) recommends the following steps to mitigate your losses.

The best way to avoid becoming a victim of a gift card scam is to only use gift cards for their intended purpose: as convenient money-equivalent gifts for friends and loved ones to purchase the item of their choice. Gift cards should never be used for debt payments.

Report Fraud

Consumers may contact the Attorney General's Consumer Protection Team at:

Consumer Protection Team
P.O. Box 30213
Lansing, MI 48909
517-335-7599
Fax: 517-241-3771
Toll-free: 877-765-8388
Online complaint form