Holiday Gift Card Scam You Need to Avoid

Tis the season to be jolly and for the creeps of mankind to come out of the woodwork to do all sorts of dastardly deeds to unsuspecting shoppers and gift-givers.

I had not heard of this particular scam, but the Colorado Bureau of Investigation says it's not new and they are seeing this show up again this holiday season.

Gift cards have become such popular gifts. They are easy and practical, and most generally always appreciated. But, if you are giving gift cards this year, you need to be aware of this scam.

In a nutshell, here's what happens. You purchase a gift card at the store and when you go to activate it you find out the card has a zero balance. How is that even possible?

Here's what the scammers do. They will go to a store display of gift cards and 'steal' the activation number on the back of the gift cards. They register the card online and as soon as the card is purchased it becomes active. After receiving notification of activation, the scammer can spend all of the funds immediately, and the gift card recipient is left with a worthless gift card.

So what can you do to avoid this unfortunate circumstance? The CBI has some advice.

First of all, they suggest you purchase gift cards from customer service and not a display. Secondly, check the activation code on the back of the card and see if it looks like the cover has been pried up.

If the card requires you to scratch off the code, check to make sure this has not already been done. Has an extra sticker with codes or phone numbers been added to the back of the card? If so, it means the card has been compromised.

By all means, save your receipt and activate your card as soon as possible so you know if it's still good or has been compromised. If you run into a situation where it appears the card has been compromised, report it to the store and to law enforcement. There's no guarantee you'll get your money back, but it's possible you can help track down the scammers.