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WSJ Your Money Briefing
Beware the Gift Card Scam
00:05:56
Wall Street Journal reporter Julie Jargon explains how scammers posing as grandchildren, government officials and tech-support agents trick people into purchasing store gift cards.
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- [00:01]
A
Still running global payroll like a relay race. Deal replaces fragmented payroll vendors with one global system. No third parties hire, manage and pay teams in 150 plus countries with in house local experts and white glove delivery and deal plugs into what you already use. Workday SAP, Netsuite operate like a local everywhere. Visit d e l.com WSJ that's d e e l.com WSJ.
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B
Here's your money briefing for Monday, December 2nd. I'm J.R. whalen at the Wall Street Journal in New York. Gift cards are a popular holiday gift and scammers want to be on your list. We'll ask a Wall Street Journal reporter to explain how the bad guys have convinced consumers to withdraw cash and purchase millions of dollars in gift cards for them. First, some money and market news you should know. So far this year, The S&P 500 is up about 25% and stocks could see a December spike in what many call a Santa Claus rally. But Wall street strategists say after December, stock market investments could lose their bright and shiny glow. With the global economy slowing and uncertainty over trade policy lingering, many on Wall street believe that stock gains will wind up only being in the single digit percentage range next year. Now Wall street forecasts are by no means set in stone and the economy isn't collapsing. The US Economy is still expected to grow on a percentage basis next year, bolstered by consumer spending that has helped offset slowing business investment. And strategists also point to economically sensitive companies like banks, manufacturers and materials companies whose shares have led the market higher in recent months. Consumers are expected to spend more than $9 billion on Cyber Monday alone. And scammers want a piece of the pie. Their latest trick is convincing people to purchase gift cards. And Wall Street Journal reporter Julie Jargan is with us to explain. So, Julie, how are the scammers tricking people?
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C
So they are either calling people on the phone or they're emailing people. And the stories are all, you know, kind of come in a variety of ways. Either people say that they are someone's grandchild and that they need money in order to get out of jail, or they're in some sort of problem. You know, they have some sort of problem and they need cash, or they say that they are tech support and that in order to fix something on the person's computer, they need to be paid with a gift card. Or they might say that they're from the IRS or state tax authority calling to collect back taxes. And in all of these scams, they're requiring payment in the form of a gift card.
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B
Why are the scammers after gift cards?
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C
Well, they're really easy for scammers to use and to use them quickly. What they do is they ask the person to go to a store, buy several thousand dollars, usually worth of gift cards, and then call them back or email them back the numeric code or a barcode that's on the back of the card. Sometimes you have to scratch it off. They read it to the scammer over the phone, or they send it to them in an email or take a picture of it and, and email them a picture of it. And then almost immediately, the scammer can then turn around and buy merchandise online with the gift cards. And it's really hard to trace all of this. And they can just do it really quickly before the person even realizes that they've been the victim of a scam.
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B
And all the while they think they're dealing with somebody that they know.
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C
They either think that, yeah. That they're dealing with someone like their grandchild, or they think it's. Sometimes they think it's their boss. I talk to a man who works in sales at a cybersecurity firm, and he received an email from what looked like his boss asking him to buy $3,000 worth of Amazon gift cards for clients. And when he saw the email come up on his phone, he didn't see the domain name of the email, he just saw his boss's name. And it sounded like the type of request his boss might make. But luckily he called his boss first and asked, you know, did you in fact ask me to buy these gift cards for clients? And his boss said, no, he had not. So, you know, the good idea is to look at the actual domain of the, of the email and see if it actually is a legitimate looking email address. And even if it does, it's always a good idea to call the person and verify.
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B
Yeah, definitely. And you spoke to a woman who wound up being scammed and buying numerous gift cards at Walmart.
- [04:28]
C
Exactly. She was an older lady who received a call from a young man who claimed that he was her grandson. He said he had been arrested and needed payment in the form of gift cards in order to make bail. And she said that he sounded like her grandson. And when she got off the phone with him, she actually called her grandson on his cell phone, but he didn't answer. And that kind of convinced her that perhaps this, in fact, was her grandson and he really was in jail and didn't have access to his phone. So she went to her bank, she withdrew $4,000 in cash. She went to her Walmart and bought cards. During her first trip, she was so nervous, she accidentally bought some prepaid mastercards which the scammer said they didn't want. They wanted Walmart gift cards. So she went back to her bank, got another $4,000, bought gift cards, and then he called her another time and said all in one day and said that he needed yet another $4,000 because the police had found drugs in the glove box of the car and were in increasing his bail amount. So in total, she had withdrawn $12,000 in one day, $8,000 of which she had used to purchase Walmart gift cards.
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B
Oh, wow. And the cybersecurity experts are saying that now that we're about to enter the holiday shopping season, be on the lookout because the scammers are likely to be ready to pounce.
- [05:51]
C
Gift cards are such a big seasonal item, especially around the holidays. And while a lot of retailers have been training their staff to be on the lookout for people buying large amounts of gift cards at the holidays, it may be a little bit harder to tell because people are making a lot of purchases as gifts for people. So this is kind of the time of year to really be on the lookout, although this does happen year round.
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B
All right, that's Wall Street Journal reporter Julie Jargan joining us. Julie, thanks for coming on the show.
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C
Yeah, thanks for having me.
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B
And that's your money briefing. I'm JR Whalen in New York for
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A
the Wall Street Journal deal replaces fragmented payroll vendors with one global system. No third parties. Hire, manage and Pay teams in 150 countries. Operate like a local everywhere. Visit d e l.com WSJ.