Gift cards a good choice, but are susceptible to scammers
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Gift cards have become a very popular gift option. They allow recipients to purchase what they want most, are always the right size, and are quick to buy and easy to wrap or mail. Sounds like a pretty good option.
But because so much money is spent on gift cards, crooks have discovered this is a good area to hunt for victims.
Today, we are going to discuss ways gift cards can be compromised so that you can keep from being scammed. It is important to be careful where you purchase a gift card. Buy it from a recognized and trusted source. Sometimes, you see discounted offers on the internet. While we all like to save money, be careful. It is easier to scam someone if that person does not have to look you in the eye, and the seller can be very difficult to find if there is a problem.
There can be some legitimate secondary markets for people who received a gift card they will never use. They may be willing to take less because they often cannot return the card for a cash refund, There, however, is a much greater opportunity for problems. The balance may have been drained or the card may not have been activated. Be careful of flea markets and other questionable sites.
When buying a card from a known source, be sure to inspect the packaging. Often, crooks will carefully open the card and copy down the numbers. They may carefully scratch off the PIN off of the coating cover. You may not notice it is missing or a crook can buy replacement coverings.
If a card looks tampered with, pick a different one. Sometimes, it is suggested that you select a card further back in the stack or on the hook, where it is little harder for a scammer to steal the information. Also, buying from a rack at the front of a store may be a little safer.
Thieves actually use software to frequently check card numbers to see whether they have been activated. When numbers show up as activated, scammers drain the money value quickly, making your card worthless.
Using the cards quickly can help to reduce a crook’s opportunity. Because of this, buying Christmas gift cards at the last minute may offer some protection.
Check the activation code printed on your receipt to make sure it matches the numbers on the gift card. If it does not, there is a problem. The card you just purchased may have already had value removed. Be observant at the checkout. While this is not usually the biggest problem area, some clerks have been caught switching cards at the cash register.
You should never have to provide personal information, such as Social Security number or home address, when buying or using a gift card. Neither the Internal Revenue Service nor any other government agency will ask you to make payments to them with gift cards.
Gift cards can be a great choice, but use common sense and be careful.
Gary Boatman is a Monessen-based certified financial planner and the author of “Your Financial Compass: Safe passage through the turbulent waters of taxes, income planning and market volatility.”
To submit columns on financial planning or investing, email Rick Shrum at rshrum@observer-reporter.com.