Gift card scams generate billions as regulators fail to protect consumers
Gift card scams generate billions annually, particularly affecting seniors, with regulators failing to implement necessary protections. Victims often remain silent due to embarrassment, while the industry lacks transparency on fraud.
Read original article
Gift card scams have become a significant issue, generating billions for fraudsters and the industry while regulators struggle to protect consumers. An estimated $8 billion is stolen annually from seniors through various frauds, with gift cards increasingly being the preferred payment method. The case of an 83-year-old woman, Mae, illustrates how easily individuals can fall victim to these scams. After encountering a fake tech support message, she was manipulated into purchasing gift cards, which fraudsters then exploited for online purchases. The lack of regulatory protections for gift cards, unlike credit and debit cards, allows fraud to flourish. Retailers and technology companies benefit from the gift card economy but often do little to assist in tracking down criminals. The problem is exacerbated by the secretive nature of the technology companies involved, which are not legally required to implement fraud prevention measures. Despite the prevalence of these scams, many victims do not report their losses due to embarrassment or fear of being judged. The gift card industry, which adds approximately $550 billion annually, lacks comprehensive data on fraud, making it difficult to assess the true scale of the problem. As gift cards continue to grow in popularity, the absence of consumer protections and the exploitation of vulnerable individuals remain pressing concerns.
- Gift card scams generate billions annually, particularly affecting seniors.
- Regulators have failed to implement necessary protections for gift card transactions.
- Victims often do not report fraud due to embarrassment or fear of repercussions.
- The gift card industry lacks transparency and comprehensive data on fraud.
- Technology companies involved in gift card transactions are not required to prevent fraud.
Related
Who Owns Your Wireless Service? Crooks Do. (2019)
Cybercriminals exploit wireless carriers' vulnerabilities, compromising security. Incidents include data breaches and SIM-swapping attacks. Industry lacks control, regulators struggle. Efforts like SHAKEN/STIR in place, but challenges persist. AT&T developing solutions. Lack of privacy laws leaves consumers vulnerable.
Unstoppable AI scams? Americans admit they can't tell what's real anymore
Americans are feeling vulnerable to scams with AI integration. 48% feel less "scam-savvy," struggling to identify scams, especially if impersonating someone they know. Concerns include fake news, robo-callers, and phishing attempts. Financial sector needs more protection. 31% have privacy, data, and fraud concerns despite some positive views on AI. 69% believe AI significantly impacts financial scams, with only 25% seeing a positive impact on financial safety. Recommendations include verifying identities and using advanced algorithms to prevent fraud. Vigilance and regulation are needed as AI technology advances and scammers adapt.
One Man Lost $740k to Scammers Targeting His Retirement Savings
Barry Heitin, a 76-year-old retired lawyer, lost $740,000 to an online scam targeting seniors, highlighting their vulnerability. The FBI reported significant cybercrime losses, particularly affecting older adults in 2023.
Our data isn't safe. Resist giving it up whenever you can
Data breaches are increasingly common, with AT&T recently exposing records of 110 million customers. The author emphasizes vigilance against unnecessary data requests to enhance personal information security.
USPS Text Scammers Duped His Wife, So He Hacked Their Operation
Grant Smith infiltrated a smishing operation after his wife was scammed, revealing over 438,000 compromised credit cards. He reported findings to authorities, highlighting the global scale of the Smishing Triad's activities.
2 commentsI know people working for a gift card company. Their customer support has often had to argue to grandmas that, no, the IRS or jail does not accept iTunes gift cards. These people are so caught up in the scam by the time they go buy gift cards that they will SCREAM at you if you attempt to explain what is going on. They have already been told by the scammer that people will try and prevent them from buying the gift cards and they STILL go along with it.
The gift card company does not want this to happen, because those sales are guaranteed chargebacks, and therefore guaranteed negative profit. But there's nothing you can program into a risk model to prevent grandma from buying a gift card and sending the code to someone willingly.
Actually, there was one thing that worked okay: Banning the entire country of Nigeria from receiving gift cards in any way, but that made some employees uncomfortable and is no longer as effective.
You can’t regulate your way out of people paying fake governments in iTunes gift cards. All regulation would do is make it harder to conduct legitimate business
Related
Who Owns Your Wireless Service? Crooks Do. (2019)
Cybercriminals exploit wireless carriers' vulnerabilities, compromising security. Incidents include data breaches and SIM-swapping attacks. Industry lacks control, regulators struggle. Efforts like SHAKEN/STIR in place, but challenges persist. AT&T developing solutions. Lack of privacy laws leaves consumers vulnerable.
Unstoppable AI scams? Americans admit they can't tell what's real anymore
Americans are feeling vulnerable to scams with AI integration. 48% feel less "scam-savvy," struggling to identify scams, especially if impersonating someone they know. Concerns include fake news, robo-callers, and phishing attempts. Financial sector needs more protection. 31% have privacy, data, and fraud concerns despite some positive views on AI. 69% believe AI significantly impacts financial scams, with only 25% seeing a positive impact on financial safety. Recommendations include verifying identities and using advanced algorithms to prevent fraud. Vigilance and regulation are needed as AI technology advances and scammers adapt.
One Man Lost $740k to Scammers Targeting His Retirement Savings
Barry Heitin, a 76-year-old retired lawyer, lost $740,000 to an online scam targeting seniors, highlighting their vulnerability. The FBI reported significant cybercrime losses, particularly affecting older adults in 2023.
Our data isn't safe. Resist giving it up whenever you can
Data breaches are increasingly common, with AT&T recently exposing records of 110 million customers. The author emphasizes vigilance against unnecessary data requests to enhance personal information security.
USPS Text Scammers Duped His Wife, So He Hacked Their Operation
Grant Smith infiltrated a smishing operation after his wife was scammed, revealing over 438,000 compromised credit cards. He reported findings to authorities, highlighting the global scale of the Smishing Triad's activities.