A new spotlight on data from the Federal Trade Commission shows that in the first nine months of 2021, consumers reported losing $148 million to scams where gift cards were used as a method of payment. This amount is higher than it was reported for the whole of 2020.
Nearly 40,000 consumers said they had used gift cards to pay a scammer during that time, according to the Spotlight, which draws on fraud reports submitted to the FTC by consumers. Most often, consumers reported paying scammers who posed as large companies or government agencies.
A new development noted in the spotlight is the emergence of Target gift cards as the most popular choice for scammers in reports received by the FTC. Target gift cards accounted for approximately $35 million in payments to scammers, more than double that of any other gift card brand. The median amount lost when consumers paid with Target gift cards, $2,500, was higher than any other card brand, with nearly a third reporting losses of $5,000 or more.
Scammers also asked consumers to buy gift cards, regardless of card brand, at a Target store more often than at any other location, according to the Spotlight.
Since 2018, the number of consumers filing reports in which gift cards were the scammers’ method of payment and the amount they reported lost has steadily increased. The spotlight also notes that the median loss reported by consumers to scammers when paying with gift cards increased from $700 to $1,000.
The FTC has resources for consumers, including information on how to contact gift card companies to try to stop payments to scammers at ftc.gov/giftcards. The agency also has information for gift card retailers, including materials that can be displayed in stores and used to train employees in ftc.gov/StopGiftCardScams.