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How to Detect Gift Card Frauds

  • Highlights

  • Gift card scams involve getting people to disclose the gift card hidden pin to the fraudster unethically

  • Unsolicited email for utility bill payments, unlocking a frozen account, or purchases on behalf of your ‘supposed’ boss are the different types of gift card scams

Gift cards are another tool for fraudsters to dupe the innocent. The thing about this digital cash is that it is not linked to any one person, whoever has the gift card code can use it to buy merchandise or exchange it for cash. Tracing back the gift card to the user is not an easy task.

How do gift cards scams work?

You can easily detect gift card fraud by getting acquainted with the modus operandi used to commit different types of gift card scams.

Official Task Scam

The victims get an unsolicited email from their boss requesting them to purchase Gift Cards. The gift card is bought on the pretext of being used for an official purpose such as employee incentive, donation, pandemic welfare, client appreciation, etc. which cannot be bought by the ‘supposed boss’ as he is out of town or occupied. After buying the card, the victim is supposed to send claim codes or the cards to either the boss or some other person. Once the victim sends over the details, the cards are redeemed, and the victim suffers a loss.
Safety Tip: Call the boss on his mobile number or text him to confirm this communication. No organisation will ask an employee to send out gifts on their behalf to clients or charitable organisations.

Utility Bill Payment Scam

An unexpected email or call is received from an individual impersonating a utility company representative (gas, electricity, cable, or internet), who presents a potential savings opportunity if the payment is made using a Gift Card. These callers have some information about you, making the call more believable to the victim.
Safety Tip: Do not make this payment as no utility company or internet company accepts payments in the form of gift cards.

How does scamming using gift cards work

The Fake Prize Scams

The targeted person receives a call, text, or email from the scammer who claims they have won a lottery or reward which could be a cash prize, a trip, or some material stuff. However, the disclaimer they add is that in order to claim the prize, a redemption fee or claiming fee needs to be paid with a gift card. The fraudster asks the victim to purchase a particular gift card and disclose the details to them.
Safety Tip: If you are being asked to pay something upfront to claim what is yours, or have won a prize for a competition you never entered into, it is a scam.

How does scamming using gift cards work

Emergency Scam

The victim receives a panicky phone call that someone known to them needs immediate financial help and even payment via gift cards will work. So, the victim is instructed to purchase a particular gift card and share the gift card details.
Safety Tip: Call a friend, family member, or relatives to confirm this sort of request.

Unsolicited phone calls from a reputed e-commerce company

Fraudsters impersonate e-commerce customer service representatives and claim that the targeted person’s account is frozen and ask them to purchase a Gift Card from their website. They are then supposed to share the details with the caller to unfreeze the account
Safety Tip: Just like Bajaj Finserv, no legitimate company will intimidate you and request money to unblock a credit card or account. It is always recommended to reach out to the official customer care number on the website to confirm the account status.

Conclusion

Be alert and be vigilant! It is always wise to cross-check the caller’s claim. Do not panic or rush in such situations. Take a minute to rethink the scenario practically - would your gas or electricity bill company really ask you to make payments via gift cards? Or would your boss ask you to give something to a client without any official communication? No, right?

Savdhaan Rahein. Safe Rahein.

Read more:
• Cautionary Note - https://www.bajajfinserv.in/cautionary-notice-new.pdf
• Infosec Page - https://www.bajajfinserv.in/infosec-pages
• Fraud Awareness Blog - https://www.bajajfinserv.in/insights/fraud-awareness

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