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If someone contacts you with an urgent request to pay by gift card, should you do it? Here’s how to spot and avoid a scam.

A computer keyboard shows the word “scam” on a key, representing gift card scams initiated over the internet.

Let’s say someone calls you, says they’re with the IRS, and demands that you pay past-due taxes right away … with gift cards. Is it legit?

The short answer is, no. No legitimate company or organization will ever require you to pay anything with a gift card. So if gift cards are the requested payment source, that’s an immediate red flag, regardless of the other parameters of the request (or demand).

The longer answer is that while the short answer might seem logical when you think about it, many people fall for gift card scams. Because scammers play on emotions, not logic. And they do it based on urgency, not giving you time to think it through.

Let’s look at some common gift card scams, why they’re popular, how you can spot them, and most importantly, how to avoid them.

Why Scammers Love Gift Cards

Scam artists know you’ll likely react to two things:

  1. Emotion
  2. Urgency

The emotion is most often love, greed or fear — the drive to gain something positive or avoid something negative. It could also be empathy or compassion. Combined with urgency, these emotions interfere with the logical brain. In fact, emotion and urgency drive almost every decision we ever make, and the heart usually wins over the head.

But getting victims into a state of emotional panic is just the first step. Then the criminal tries to extract payment.

Gift cards are a favorite funding source for several reasons:

  • They’re readily available in stores
  • They’re almost completely untraceable
  • They’re easily converted to cash (or cryptocurrency)
  • The funds can be accessed remotely
  • Large amounts of money fit in a very small item

By the way, crypto scams are popular as well, for many of the same reasons. So if you’re asked to pay in gift cards or bitcoin, it should trigger the same cautious approach.

How Gift Card Scams Work

All gift card scams work in a similar way. It could be a phone call, text message, email, or even communication through social media. But the scammer contacting you will ask for a specific gift card to pay something regarding an urgent matter.

Scammers say it’s urgent

Con artists are looking for immediate action and will pressure you to take it by saying you’ll suffer some horrible loss if you don’t. It could be that you’ll face tax penalties, your utilities will be cut off, or you’ll lose out on a large prize you’ve supposedly won.

Scammers are specific

In day-to-day life, you usually get several convenient options to pay what you owe. But scammers will give you only one. Not only does it have to be a gift card, but it usually has to be a specific gift card — like for Amazon, eBay, Walmart, Target, Google Play, or Apple.

They might even tell you a specific store to buy it from, or send you to several stores so cashiers don’t get suspicious. And some scammers will go so far as to insist they stay on the phone with you while you complete the mission.

Scammers ask for details

If you do buy the gift card, the scammer will typically ask you to share the number and PIN from the back of the card or send a photo as “proof” that you’ve followed through. If you give them those details, the thief has immediate access to all the money, even if you still have the physical card.

Common Gift Card Scams to Avoid

While they all follow a similar pattern, there are several popular scenarios that scammers use. Here are some common scams to watch out for so you can avoid falling prey.

Government scam

Most people do what the government says, so this is one of the most prevalent gift card scams. The con artist will claim to be from a government organization like the IRS, FTC, or Social Security Administration.

They’ll say you owe taxes or have to pay a fine, and they will demand immediate payment on a gift card. But government agencies don’t demand payment right away, and they’ll never ask for it to be on a gift card.

Charity scam

These schemes appeal to your sense of compassion. The scammer will pretend to be from a charity, like the Red Cross, United Way or UNICEF, and say they need your urgent help to save lives after a disaster.

And guess what … the donation has to be made by gift card. But if charities ever do call asking for donations, they will never mandate a specific type of payment.

Utility scam

Nobody wants their utilities shut off, and scammers know that. They will say they’re from the power, gas or water company, and threaten to cut off your service if you don’t pay right away.

But while utility companies may cut you off if you don’t pay, they will give you notice. They don’t demand payment right this minute, and they definitely don’t require you to use a gift card.

Family scam

Grandparents are most often the target of these scams, where the criminal claims to be a family member or friend with an emergency. Sometimes they get convincing details from social media, and even use voice cloning to sound like the person they’re pretending to be.

They’ll ask you to send money but not tell anyone — if it’s your alleged grandkids, they don’t want you to tell their parents. But while it’s possible that a family member will contact you for help, it’s highly unlikely they’ll ask for a gift card to take care of an emergency situation. If you’re still not sure, contact the person directly to see if they’re OK.

Romance scam

Romance scams have been classic con jobs for decades, if not centuries. But current online catfish schemes are even easier and quicker for scammers to pull off. For these, a fake prospect will befriend you online, through a dating site or social media. Once they earn your trust and even love, they’ll ask for money … and, you guessed it, they prefer a gift card.

No matter how much you think you know this person, never send money through any means to anyone you haven’t met in person. Photos (and even video chat) don’t count.

Prize scam

The scammer says you won a prize, and you only need to pay for the delivery or some other fee. Oh, and that fee needs to be paid by gift card.

If you didn’t enter the raffle or contest, and you’re not getting your prize free and clear, don’t accept it. Real businesses wouldn’t have these requirements in place for an actual sweepstakes. No matter how tempting the prize might be, it’s a scam.

What To Do If You Get Scammed

First of all, if anyone ever asks you to pay anything by gift card, just say no. It’s never a legitimate request.

For anything you actually need to pay, use a credit card so it’s trackable and you’re protected against fraud. You can also pay by check or debit card, although you may still be without your money while the fraud is being investigated.

If you do get scammed despite your best efforts, follow these steps:

  1. Keep the physical card (or a photo) and your receipt

  2. Ask for a refund from the store

  3. Report the scam to the gift card company

  4. If you paid by credit card, report it to the issuer

  5. Report the fraud to the FTC

The store won’t always give you a refund, but many retailers are cracking down on gift card scams and will reimburse you if you ask. Your credit card issuer or the gift card company itself might help you out if you file reports as well.

Remember that scammers want to trigger emotional panic. They’re seeking quick payment (urgency), either to avoid a problem (fear), receive a reward (greed), or help somebody (compassion). They don’t want you to think about it, they just want you to react.


If you can take a breath and let your rational mind make the decision, chances are you can avoid being taken advantage of.

About the author:

Heather Vale

For over a quarter of a century, Heather has been working as a journalist in all media: TV, radio, print, and online. After establishing her career in Toronto, she has been living, working, and playing in Las Vegas for the past decade. She loves pulling apart complicated topics to make them simple, fun, and easy to understand, especially in the business and financial niches. But she also enjoys writing about the personal side of life, including success, relationships, families, and pets. She approaches everything from a yin-yang perspective, so her passion for wordplay and entertaining metaphors is always balanced with an intense (and some would say annoying) focus on facts and accuracy.

This material is for informational purposes only and is not intended to replace the advice of a qualified tax advisor, attorney or financial advisor. Readers should consult with their own tax advisor, attorney or financial advisor with regard to their personal situations.