New AARP report shows gift card payment is prevalent in wide range of scams

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WASHINGTON, D.C. (KAMR/KCIT) — Nearly one in three adults said they or someone they know has been a target of a gift card scam, in which a scammer asks them to purchase a gift card to pay a bill or some other obligation. The results are listed in the Gift Card Payment Scams report, released earlier this week by the AARP Fraud Watch Network.

AARP officials said the research is the conclusion of a three-year effort launched Tuesday, April 6, to raise awareness about gift card payments in scams, which is a common method used by scammers to steal money.

“With the number of reported scams on the rise, criminals are increasingly turning to gift cards as an untraceable way to take money as a part of their schemes,” said Kathy Stokes, Director of Fraud Prevention Programs at AARP. “Unfortunately, once a person gives a criminal the gift card number and PIN, the money is virtually impossible to recover. Our three-year initiative will let  consumers know that it is never legitimate when someone asks you to pay for some obligation with a gift card.”

The report, AARP said, also found that one-in-10 respondents admitted they bought a gift card after being asked by someone they didn’t know to pay a bill, pay a fee to win a prize or handle another financial obligation.

Gift card usage as a form payment is a common method across a large number of imposter scams, and a quarter of U.S. adults acknowledge paying by gift card to claim a large prize, sweepstakes or lottery, AARP officials said. Scammers were also able to coerce adults buy gift cards settle issues with a Social Security account, pay upfront for a service or product, fix a computer, or pay a utility bill.

“There are no two ways about it, asking to be paid by gift card is a scam 100 percent of the time,” said Stokes. “Yet, nearly a quarter of U.S. adults don’t know or are unsure whether or not payment by gift card equals a scam.”

According to AARP, other survey findings were:

  • Adults younger than 50 are more likely than adults over 50 to say they or someone they know have been directed to pay for an obligation using gift cards.
  • Most respondents who bought gift cards as requested said they purchased them at big box retailers like Walmart or Target and at pharmacy chain stores like CVS or Walgreens.

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