What You Need to Know about Gift Card Scams

Gift cards are easy to buy, easy to use, and unfortunately, easy for scammers to exploit. In recent years, gift card scams have grown into a widespread and costly problem, affecting millions of consumers across the U.S.

Here’s what you need to know about how these scams work, the warning signs to watch for, and how to protect yourself.

‍

Why Gift Card Scams Are So Common

According to the Federal Trade Commission, consumers lost at least $212 million to gift card-related scams in 2024. The FTC notes that the real number is likely much higher, since many people never report these crimes.

Gift cards are especially attractive to scammers because:

• They work like cash
• They’re familiar and easy to use
• Once the money is gone, it’s usually gone for good
  
  

‍

How Gift Card Scams Work

Most gift card scams start with a call, text, email, or social media message. Scammers will say almost anything to convince you to buy gift cards, often from major brands like Apple, Amazon, Google Play, Target, or Walmart, and share the card number and PIN.

According to the FTC, these scams usually include a few key pressure tactics:

They Create Urgency

Scammers insist you must act immediately or face serious consequences like a fine, arrest, or service shutoff. The goal is to stop you from slowing down or checking with someone you trust.

They Tell You Exactly What to Buy and from Where

They may direct you to specific stores like Walmart, Target, CVS, or Walgreens, sometimes telling you to buy cards at multiple locations. In some cases, they stay on the phone with you while you’re at the store.

They Ask for the Card Numbers and PIN

Once someone has the card number and PIN, they can drain the money even if you still physically have the card. Never share this information or send photos of the card.

‍

Gift Card Draining: A Scam That Starts Before You Buy

In addition to direct scams, criminals may steal gift card value before a card is even purchased.

This is known as gift card draining. Criminals remove cards from store racks, record the card number and PIN, then repackage the card and return it to the shelf. Once a shopper buys and activates the card, the scammer quickly drains the balance online.

A 2025 AARP survey found that 33% of adults have given or received a gift card with zero value, often because of this tactic.

‍

Before You Buy: Warning Signs & Smart Checks

Watch for these red flags before buying a gift card:

• Torn or damaged packaging
• Pull tabs that look bent, cut, or reattached
• PIN covers that are missing, wrinkled, or uneven
• Packaging that looks different from other cards on the rack
• Branding or logos that don’t quite match or look blurry

‍

Sometimes there are no visible signs of tampering. That’s why how and where you buy gift cards matters. Purchasing a digital gift card directly from the retailer’s official website or app can be one of the safest options, since it avoids in-store tampering altogether. Just be sure you’re buying from the legitimate retailer and not a third-party seller.

‍

How to Protect Yourself

• Never pay for anything with gift cards
  If someone asks, stop — it’s a scam.
  
  
• Buy gift cards directly from the issuing retailer
  Avoid third-party sellers or websites that specialize in digital gift cards.
  
  
• Inspect cards carefully before buying
  Compare the card to others on the shelf and avoid any that look altered.
  
  
• Use a credit card when possible
  Credit cards may offer more protection if something goes wrong.
  
  
• Keep your receipt
  It may help if you need to report a problem.

‍

Gift card scams rely on urgency and confusion. Carefull helps you slow down, spot red flags early, and get support when something doesn’t feel right. You can try Carefull for free for 30 days.