Beware the Gift Card Scam
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What is the main topic discussed in this episode?
Here's your Money Briefing for Monday, December 2nd. I'm J.R. Whelan at The Wall Street Journal in New York. Gift cards are a popular holiday gift, and scammers want to be on your list. We'll ask a Wall Street Journal reporter to explain how the bad guys have convinced consumers to withdraw cash and purchase millions of dollars in gift cards for them. First, some money and market news you should know. So far this year, the S&P 500 is up about 25%, and stocks could see a December spike in what many call a Santa Claus rally. But Wall Street strategists say after December, stock market investments could lose their bright and shiny glow. With the global economy slowing and uncertainty over trade policy lingering, many on Wall Street believe that stock gains will wind up only being in the single-digit percentage range next year.
How are gift-card scams being carried out by phone and email?
Now, Wall Street forecasts are by no means set in stone, and the economy isn't collapsing. The U.S. economy is still expected to grow on a percentage basis next year, bolstered by consumer spending that has helped offset slowing business investment. And strategists also point to economically sensitive companies like banks, manufacturers, and materials companies whose shares have led the market higher in recent months.
Consumers are expected to spend more than $9 billion on Cyber Monday alone, and scammers want a piece of the pie. Their latest trick is convincing people to purchase gift cards, and Wall Street Journal reporter Julie Jargon is with us to explain.
Which impersonation tactics do scammers use to pose as family or officials?
So Julie, how are the scammers tricking people?
So they are either calling people on the phone or they're emailing people, and the stories are all you know, kind of come in a variety of ways. Either people say that they are someone's grandchild and that they need money in order to get out of jail or they're in some sort of problem, you know, they have some sort of problem and they need cash. Or they say that they are tech support and that in order to fix something on the person's computer, they need to be paid with a gift card. Or they might say that they're from the IRS or a state tax authority calling to collect back taxes and And in all of these scams, they're requiring payment in the form of a gift card.
Why do scammers demand payment specifically with gift-card codes?
Why are the scammers after gift cards?
Well, they're really easy for scammers to use and to use them quickly. What they do is they ask the person to go to a store, buy several thousand dollars usually worth of gift cards, and then call them back or email them back the numeric code or a barcode that's on the back of the card. Sometimes you have to scratch it off. They read it to the scammer over the phone or they send it to them in an email or take a picture of it and email them a picture of it. And then almost immediately, the scammer can then turn around and buy merchandise online with the gift cards. And it's really hard to trace all of this. And they can just do it really quickly before the person even realizes that they've been the victim of a scam.
What real-life examples show how victims are manipulated into buying cards?
And all the while, they think they're dealing with somebody that they know.
They either think that, yeah, that they're dealing with someone like their grandchild or they think it's sometimes they think it's their boss. I talked to a man who works in sales at a cybersecurity firm. And he received an email from what looked like his boss asking him to buy $3,000 worth of Amazon gift cards for clients. And when he saw the email come up on his phone, he didn't see the domain name of the email. He just saw his boss's name. And it sounded like the type of request his boss might make. But luckily he called his boss first and asked, you know, did you in fact ask me to buy these gift cards for clients? And his boss said, no, he had not. So, you know, the good idea is to look at the actual domain of the email and see if it actually is a legitimate looking email address.
And even if it does, it's always a good idea to call the person and verify.
Yeah, definitely. And you spoke to a woman who wound up being scammed and buying numerous gift cards at Walmart.
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Chapters
7 chapters
1
What is the main topic discussed in this episode?
0:05–0:53
2
How are gift-card scams being carried out by phone and email?
0:53–1:39
3
Which impersonation tactics do scammers use to pose as family or officials?
1:39–2:19
4
Why do scammers demand payment specifically with gift-card codes?
2:19–3:00
5
What real-life examples show how victims are manipulated into buying cards?
3:00–4:02
6
How can consumers verify suspicious requests and avoid falling for scams?
4:02–4:55
7
Why are gift-card scams more common around the holiday shopping season?
4:55–5:56
Speakers
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