What to look for, how to protect yourself from new gift card scam
Authorities are warning shoppers of a new scam targeting gift cards. Here is what to look for and some ways to protect yourself.
Gone are the days of wandering department stores looking for gifts for the whole family once December rolls around. In the modern age, Christmas shopping can be completed from your couch after 30 minutes of scrolling through online marketplaces. However, in Alabama, this can come at a price beyond your expected subtotal in your Amazon cart.
In 2023, Americans lost $12.5 billion to online scams, with Alabama contributing $96.4 million and 5,763 victims to that total, a recent study by reverse search company Social Catfish found. These numbers rank Alabama as 27th in the nation most likely to fall for an online scam.
Additionally, Alabama ranks 13th among the list of states with the highest rates of online scam reports, with 1,104 reports per 100,000 residents in the state’s population. Georgia was the number one state in that category, with 1,564 reports per 100,000 residents.
Alabama also took five spots on the list of top 100 metropolitan areas in America with the highest rate of complaints, with Tuscaloosa, Montgomery, Hoover-Birmingham, Huntsville and Mobile ranking second, 27th, 40th, 47th and 91st respectively.
The national total loss to scams last year saw a $10.3 billion increase from 2022 data according to the Federal Bureau of Investigation Internet Crime Complaint Center, and an “unprecedented” 39% of those victims fell for scams crafted with artificial intelligence deepfake technology.
A deepfake is a type of media in which an existing image or video of a person is replaced with someone else’s likeness. AI and deep learning algorithms used to create deepfakes can use this person’s likeness to impersonate them and say whatever they wish, which preys upon public trust in figures like politicians, celebrities or business leaders to make scams seem more credible.
FBI data surveyed in the study shows that over 95.7% of money lost to online scams in 2023 was never recovered, because many scammers live overseas — which means U.S. law has no jurisdiction in those areas — and use payment methods that are difficult to trace, if traceable at all.
One particular platform where scams thrive is social media. The study found Facebook to be the platform that most commonly houses scams, with Instagram and WhatsApp following close behind.
According to the study, Americans are projected to spend $240 billion online shopping this holiday season, which means preventative internet shopping safety measures on the consumer’s side is more important than ever.
Here are some common tricks to look out for this holiday season:
- Look-alike stores: A common scam method involves scammers creating a fake website that looks similar to the real website you’re trying to visit, which will compromise your data when making a purchase. Carefully check website URLs (for example, “Macys.com” versus “Maceys.com”) to avoid these fraudulent websites and look for other “tells” of scams (poor or stilted English, unpolished or dated graphic design, unprofessional/unconventional fonts, etc.).
- Deepfake videos: A scam on the rise has been deepfake videos impersonating public figures to convince users to trust fraudulent deals, which are particularly common on social media. Look for audio not matching lip movements, unnatural movement (unchanging facial expressions, strange movement of lips, glazed over eyes that don’t move naturally, blink rate being off), monotone voice, extra body parts, audio distortion, and inconsistent lighting, and be especially vigilant when using social media platforms like Facebook, Instagram or WhatsApp.
- Hard-to-trace payment methods: If a seller asks for payment in cryptocurrency, gift cards (especially Steam gift cards or Apple gift cards), a wire transfer or bank transfer, be cautious and reevaluate the legitimacy of the transaction. Scammers use these methods because they are difficult — if not impossible — to trace, which makes it even harder to get stolen money back once it’s gone.
- Discounted gift cards: Fake marketplaces may advertise “discounted” gift cards only to sell a gift card with zero balance. Be wary of “deals” like these, as they are often scams.
- Suspicious activity alert: Some scams are designed to make consumers believe their account has been hacked. They use a sense of urgency to trick the consumer into calling an AI customer service representative to “verify their account,” but in reality, their information is being stolen. To avoid this, be wary of any notification that urges immediate action on account of suspicious activity and only contact a company using the main number on their official website.
Sarah Clifton covers business for the Montgomery Advertiser. You can reach her at sclifton@montgome.gannett.com or follow her on X @sarahgclifton.