By Charlestien Harris

Gift cards are a popular and convenient way to give someone a gift. They’re also a popular way for scammers to steal money from you, because gift cards are like cash. If you buy a gift card and someone it wasn’t intended for uses it, you probably won’t get your money back.

Gift cards are for gifts, not payments. Anyone who demands payment by gift card is always a scammer. Most scammers will use scare tactics and deceptive practices such as demanding a gift card as the only form of payment. The Federal Trade Commission has issued several warnings to consumers when it comes to using gift cards as a form of payment.

The scam often starts with an email or phone call from an alleged family member needing some assistance and a gift card would be the fastest way to get the money to them.  Next the scammer will ask you to scratch off the numerical code located on the back of the card as well as the PIN number and then read it to them for verification.  Once that is done, the money is usually taken off the card immediately and you have just lost your hard-earned cash to a thief!

If you paid a scammer with a gift card, tell the company that issued the card right away. When you contact the company, tell them the gift card was used in a scam. Ask them if money is still on the card, and if they can refund your money. If you act quickly enough, the company might be able to get your money back. Beware that some companies will not return any money even if the gift card hasn’t been used. Remember to keep the gift card itself and keep the gift card receipt. Also, tell the store where you bought the gift card as soon as possible.

Here are some simple tips to follow when giving gift cards as gifts:

1. Buy gift cards from sources you know and trust.  Purchase from retailers you are most familiar with and ask about the store or company policy when it comes to lost or stolen cards.

2. Inspect gift cards before you buy.  A gift card should have all its protective stickers in place and the package should not look like it has been tampered with.  If it has report it to the store management.

3. When you buy the gift card, save the receipt.  Keeping the gift card receipt can be helpful if you run into a problem with the card.

4. Treat gift cards like cash or any other debit/credit card. Don’t share your card number or pin with anyone. Always report lost or stolen gift cards to the card’s issuer immediately. Most card issuers have toll-free numbers you can find online to report a lost or stolen card.  Depending on the card issuer, you may even be able to get some of your money back.

5.  Read the terms and conditions of the gift card. Is there an expiration date? Are there fees to use the card, or for shipping and handling? Will fees be taken out every time you use the card, or after it sits unused?

6. Use the card as soon as you can. It’s not unusual to misplace gift cards or forget you have them. Using them early will help you get the full value.

Giving gift cards can be a practical and economical way to send cash to your loved ones when you don’t know what to get them for Christmas. Just be careful and make sure you know exactly who you’re giving the card to. For more information you can visit www.ftc.gov/giftcards. To report fraudulent activity visit www.ReportFraud.ftc.gov. Until next week, stay financially fit!