It’s coming down to the wire, you haven’t bought everyone a present yet and you’re thinking gift cards solve everything, right?
Well, you could be wrong because while they’re a wildly popular item this time of year, thieves could be the real recipients of your gift cards.
“Because they’re so readily available, fraudsters will actually go up and copy those numbers and then they’ll go online or they’ll call the number and as soon as that card is activated,” says Jean Setzfand, a fraud expert with nonprofit AARP.
That’s why AARP is sounding a holiday alarm on gift cards.
According to the National Retail Federation, 7 in 10 people will purchase a gift card during the holidays, an end-of-year surge that will total nearly $131 billion dollars in sales.
That kind of cash attracts thieves who are using card scanners to read magnetic strips or copying code numbers to monitor online when the card is activated.
“I purchase a card for, let’s say, Chili’s, and as soon as I activate my card they’ll be notified first where they’re actually on top of it and they’ll drain the card before I even access it,” Setzfand says.
If you still want to buy a gift card, AARP suggests to buy one online, direct from a retailer or purchase one at the retail business of your choice. Buy one off a drugstore or supermarket rack and you might run the risk that a thief has seen the card first.
“You don’t have the card hanging on a rack for many days and accessible by fraudsters, who can copy that number and drain that account before you actually use it,” Setzfand says.
Other important things to remember:
- If you buy a gift card keep the receipt so you can be reimbursed if a hacker has left you with a zero balance.
- If you receive a gift card, use it. The longer it’s active, the longer a scammer has to hack it.
- If you don’t use it right away, register it with the retailer. That should prevent fraud or misuse.
- Electronic gift cards are a great alternative to prevent fraud. They are sent from the retailer to you or whomever you intend the gift for, eliminating the potential for fraud.
For more tips on gift cards, visit the Federal Trade Commission here.