Every year, scammers trick millions of Americans to hand over hundreds of millions of dollars in gift card payments. Retailers aren’t doing much about it.
This story began for me when I stumbled on a corner of the internet devoted to wasting time. Specifically, someone else’s. More specifically, scammers.
A new group of vigilantes were blowing up on social media, sharing their exploits as they recorded themselves baiting scammers to talk to them. But they weren’t just wasting time. As I’d watch in hundreds of videos, they’d quietly take control of the fraudster’s computer, downloading victim lists, login information and even photographs in an effort to disrupt scams as much as possible.
The scammers meanwhile would stick to their script, thinking they were luring an elderly victim to give over thousands of dollars.
Almost every time, when it came to asking for money, the scammers would ask for payment in gift cards.
I soon found out why. Gift cards are easy to buy and hard to trace. Law enforcement barely bothers taking reports of frauds where they happen because there’s almost no hope of recovering what’s lost. And retailers have no obligation to help victims get their money back.
“If someone coerces you, then you’re out of luck.”
Kathy Stokes, AARP
As a result, many people don’t even report the crime out of embarrassment.
So, how bad is it?
Most people had no idea until last year, when the Federal Trade Commission reported more than $245 million in money lost to gift card scams since 2018. But nearly every expert I spoke to said it’s likely off by a zero or more.
And it hits all age groups, way more than you think. It’s all about social engineering that’s diabolically good at ensnaring even the smartest people you know. And the median individual loss is estimated to be about $840 out of pocket.
“This is only the tip of the iceberg.”
John Breyault, National Consumers League
Over the next couple weeks, CNET will be publishing a series of stories based on what my colleagues and I have learned.
The first story focuses tells how this problem is way bigger than you think, and profiles people who are trying to help clean up the mess.
Please share this story with your family and friends. Statistically, at least one of them has already been victimized. And another likely will be unless we learn to stop it.
Here’s the link:
Thank you for reading.