What is a Gift Card Scam and How Does It Work?

What is a Gift Card Scam and How Does It Work?

What is a Gift Card Scam?

In the booming online market and e-commerce sector, online payments have become a norm. At the same time, people are switching to online payment options with companies allowing users to purchase gift cards in the form of prepaid cards that consumers can give to their friends or family members.

However, there are some scammers who have found a way to use a convenient and innovative solution in an opportunity to commit fraud. A gift card scam takes place when scammers trick an unsuspecting user into purchasing a gift card and steal the secret PIN or passcode to utilize it without permission.

How does a Gift Card Scam Work?

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Scammers can plant malicious codes at e-commerce websites or other trading platforms that users visit to purchase gift cards. In this manner, they might be able to collect the secret credentials of every gift card purchased when it is issued. This method is unusual as it requires technical knowledge and programming skills.

However, scammers can use simpler methods such as creating fake Telegram accounts pretending as legitimate investors.

When investors approach these fake accounts to trade cryptocurrencies with them, the scammers offer to sell their cryptocurrencies at a considerable discount. Rather than making direct payments in the form of cryptocurrencies, investors ask their targets to purchase gift cards and share the codes with them that allow them to purchase cryptocurrencies.

However, once the targeted investors share the gift card code the scammers vanish. Steps involved in these types of scams are mentioned as under:

Open a social media account under false pretext pretending to be a crypto merchant or broker. Luring in potential victims by advertising a fake or unrealistic investment opportunity.

Ask interest targets to make payments in the form of gift cards as a way to circumvent regulatory requirements and checks.

Direct investors to purchase gift cards from designated websites or trading platforms using referral links that can subject them to rewards, bonuses, or payments etc.

Convincing targets to share personal code and secret passwords with the scammers as a way to exploit them.

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Closing fake social media accounts or going AWOL without completing the trade agreement and using the gift card for personal purchases.

Signs of Gift Card Scam

Here are some visible signs of gift card scams that every investor should beware of:

Cryptocurrency investors ensure that scammers often talks about unrealistic returns for investors rather than offering them a transparent and qualified investment plan.

Scammers usually operate with a sense of urgency to ensure that their targets are unable to run a background check or conduct research that will deter them from participating.

Scammers often use psychological tactics to force their victims to react without verifying the validity of the investment offer.

Scammers may try to approach targets using tactics such as unauthorized communication via private messaging on social media accounts or spamming.

Scammers use bad grammar and spelling errors to bypass the spam checking protocols to reach potential targets.

How to Avoid Gift Card Scams

Before investing in an unverified opportunity, the scammers have to ensure that they have to run background checks and compare returns with other platforms to get an idea about the market dynamics.

Investors should never comply with the request to make payments in the form of gift cards. This type of payment method prevents the trading platforms from making claims or recalling the transactions once the scammers have utilized them.

Investors should collect detailed information about the firms that are selling the gift card or offering the supposed investment plan on their official websites or by talking to a verified representative.

Investors should refrain from sharing personal information with scammers such as social security number, bank account details, or credit card information etc.


In case of if a person is already affected by gift card scammers, they can use various methods to recover their lost funds such as informing the Federal Trade Commission, Internet Crime Complaint Center, or cryptocurrency exchange.

Author: Isacco Genovesi

Isacco writes news articles, reviews and guides about cryptocurrencies including technical analysis, blockchain events, coin prices marketcap and detailed reviews on crypto exchanges and trading platforms.

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