The Various Outcomes of ITunes Gift Card Scams Using Paypal & Other Sources

The money you put on your Paypal Apple gift card is similar to cash in that once it’s spent, you almost certainly won’t be able to get it back. Gift card payment scams and outright gift card theft are two distinct ways fraudsters can take advantage of this.

According to the Federal Trade Commission, gift cards are the most common way scammers seek payment from their victims (FTC). Con artists use popular gift cards from Target, Walmart, iTunes, and other retailers as cash conduits in impostor and phone scams. Consumers who reported gift card payment scams to the FTC in the first nine months of 2021 lost $148 million — more than was reported stolen by this method in all of 2020.

iTunes Gift Card

Someone may request that you pay for something by loading money onto a gift card, such as a Google Play or iTunes card, and then providing them with the numbers on the back of the card. They attempt to defraud you if they ask you to do this. No legitimate business or government agency will require you to pay with a gift card. Anyone who demands payment through a gift card is a scammer. Continue reading to learn more about gift card scams.

Results show that fraudsters are shifting focus from account takeovers to scams where customers are exploited as a week link

KPMG 2019 Report

If you’re someone who wants to protect your financial transactions, then you’re definitely at the right place. We can give you the best practices in identifying red flags as well as help you in recovering your stolen money from scammers!

Table of Contents

Gift Card Scams

Gift cards are intended to be given as gifts, not as payment. However, they are popular with scammers because they are simple to find and purchase and provide fewer buyer protections than other payment methods. 

They function more like cash in that once you use the card, the money on it is gone. Scammers use tactics like this.

According to experts, there are two types of gift card scams. The first entails attempting to dupe you into paying an impostor with gift cards. You may receive a phone call or text message from someone claiming to be a police officer, IRS agent, or government official demanding that you pay a fee or debt by purchasing gift cards and sending the information back to them. The second type of scam involves fraudsters selling fake gift cards at reduced prices online. Although purchasing used gift cards rather than new ones can save money, consumers should be wary of gift card scams and other common shopping scams on person-to-person sales sites such as Facebook Marketplace and eBay.

Itunes Gift Cards

The urgency with which a caller asks you to purchase a gift card should raise a red flag. According to Pargman, scammers will “try to convince you that you must act immediately or face dire consequences.” Meanwhile, gift card scams that try to sell you fake gift cards often look like too-good-to-be-true deals, such as a $100 gift card for $50. “It’s best to pass on these offers, so you don’t end up with a worthless card, or worse—giving it as a gift to a loved one who later discovers it’s worthless,” says Pargman.

If someone calls you and demands that you pay them with gift cards, you can bet they’re a scammer. They have your money once they have the gift card number and PIN. Scammers may tell you a variety of stories to entice you to pay them with gift cards, but here’s what usually happens:

  • The caller claims that it is urgent. The scammer claims that you must pay immediately or something terrible will happen. But you don’t, and it’s not going to happen.
  • The caller will usually tell you which gift card to purchase. They may advise buying an itunes gift cardd with Paypal or an eBay, Google Play, Target, or iTunes gift card. They may direct you to a specific store, usually Walmart, Target, CVS, or Walgreens. They sometimes say to buy cards at multiple stores, so cashiers don’t get suspicious. Furthermore, the caller may remain on the phone while you go to the store to load money onto the card. All of these are indications of a scam.
  • The caller requests the gift card number and PIN. The card number and PIN on the back of the card enable the scammer to obtain the funds you loaded onto the card. And the con artist gets it right away.
ITunes Gift Card 2015

How Scammers Persuade You to Use Gift Cards

Scammers pose as someone they are not to persuade you to pay with gift cards or buy itune card with Paypal. They want to scare or pressure you into acting quickly so that you don’t have time to think or speak to someone you trust. The following are some examples of common gift card scams and schemes:

  • The caller claims to be from the government, possibly the Internal Revenue Service or the Social Security Administration. They claim you must pay taxes or face a fine, but this is a ruse.
  • Someone from tech support calls, possibly claiming to be from Apple or Microsoft, and claims that something is wrong with your computer. But this is a lie.
  • You meet someone special on a dating website, but he needs money and requests that you assist him. This romance scammer will tell you any story to get you to send him gift cards.
  • The scammer poses as a friend or family member in an emergency and requests that you send money immediately — but not tell anyone. This is known as a ruse. If you’re concerned, hang up and call a friend or relative to ensure everything is fine.
  • Someone tells you you’ve won a prize, but you must pay fees or other charges with a gift card first. Remember, no honest company or organization will ever force you to pay with a gift card. But, also, did you enter the sweepstakes?
  • The caller claims to be from your utility company or another. She threatens to disconnect your service if you do not pay right away. However, utility companies do not operate in this manner. It’s a ruse.
  • Someone hands you a check for far more than you expected. They instruct you to deposit the check and then give them the difference in the form of a gift card. But that check will be a forgery, and you will lose all your money.
If you have been scammed by an online scam then contact us to help you get your money back!

Do you suspect that someone had scammed you?

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Dangers of ITunes Card Paypal

In the last month, Itunes gift cards have caused retailers a lot of trouble, exposing yet another way that fraudulent activity can eat into razor-thin profit margins. 

Buying Itunes with Paypal is a call for concern! Physical theft, cloning, and exploiting programming errors on the merchant side are all examples of gift card fraud.

There are numerous ways to commit fraud with gift cards, which are very appealing for various reasons. First and foremost, there is a low likelihood of prosecution. The dollar amounts on each transaction are relatively small and insufficient to attract the attention of large law enforcement agencies capable of apprehending the perpetrators. Second, it is elementary to commit fraud. Finally, it is simple to convert the value of a gift card into cash or merchandise. How is most gift card fraud committed? It starts with buying an Itunes gift card Paypal and then there are three major types of fraud:

Apple Gift Cards

1. Hacking Accounts

Another popular method is quickly monetizing the value in other hacked accounts, such as credit card rewards programs or hotel points, using gift cards.

Here’s how it works:

A cybercriminal will obtain a person’s credit card rewards program username and password, usually through reused credentials or malware. They will log in and check the account balance. Let’s say the amount is $5,000.

Credit card redemption programs provide a wide range of items that can be redeemed in exchange for points. The fraudster faces several challenges. They won’t be able to save for golf clubs – where would they ship them? Cashback is either redeemed as a statement credit or mailed to the cardholder – neither of which is acceptable. On the other hand, gift cards are an excellent way to monetize the hack quickly. The redeemer immediately receives an e-gift card number that they can spend, implying that the fraudster can exchange $5,000 points for $5,000 in e-gift card value. The site will immediately provide the fraudster with a gift card number, which can be printed and used in-store or online.

The fraudster will then use a service like cardcash.com or cardhub.com to convert gift cards into cash. On sites like this, one can usually get 60% of the face value of a typical gift card. Physical kiosks in malls also provide the same service. A fraudster can now convert a point or reward from a hacked account into real money.

2. Cloning Cards

Another standard method of gift card fraud is the theft of numbers from physical gift cards. 

Gift cards function similarly to credit cards with a mag stripe in that the gift card number is printed on the card for manual key entry and encoded on a mag stripe on the back of the card.

The mag stripe number is plain text and can be read with a $15 mag stripe reader from eBay or an electronics store. Gift cards may or may not have an added level of security, such as a PIN covered with a coating that one must scratch off, similar to a lottery ticket.

Some merchants, such as Starbucks, do not require the customer to enter a PIN number when using the card. The customer swipes the card and is on their way. Other merchants do use PINs, which adds an extra layer of security because the redeemer must have the physical card in hand to use it.

Gift cards cannot be used until activated at the cash register. Gift cards are often displayed prominently in many stores. People have been known to steal a stack of cards, take them home, write down the numbers (or script it out with a mag stripe reader), and then sneak them back into the store and put them on the shelf.

online fraud

Brazen criminals can write down or photograph the numbers right in the store. Then it’s just a matter of waiting. Most merchants allow customers to check gift card balances online; fraudsters will check balances on the merchant’s website repeatedly until a legitimate purchase activates them. When they are, transferring balances to another card or converting to cash through a third-party redeemer depletes the balances.

There have been no reports of POS skimmers being used to steal gift card numbers, but this attack would also work. A PIN can delay a fraudster but not wholly deter them. They can scratch off the coating, reveal the PIN, and replace it with a new sticker easily obtained on eBay.

This type of fraud is relatively low-level and does not result in a significant loss for the merchant. Still, it surprises the customer when the recipient of a gift card attempts to redeem it and discovers that the balance is zero. Some retailers will reimburse the customer for the face value of the gift card, but this results in a loss of reputation for the retailer and a headache for the customer.

3. Acquiring Gift Cards in Bulk

Obtaining gift card numbers in bulk from issuers, merchants, reward redemption programs, and so on is slightly more complicated but far more rewarding. 

This can be accomplished through various means, including phishing, SQL injection, social engineering, and unintentional disclosure.

Accidental disclosure occurred at Woolworth’s, where an employee had a spreadsheet containing 8,000 gift card numbers worth AUS $1.3 million. The employee inadvertently sent the email to over 1,000 people. Anyone who received the email could go shopping right away or begin converting the gift card numbers into cash.

How to Avoid Gift Card Scams

According to the best advice, customers should only purchase gift cards from reputable merchants.

Examine the physical card for signs of tampering, such as a scratched-off or replaced PIN. The most important thing is to keep your receipt. If you receive the card and discover that it has been depleted of funds, you may be able to recoup your losses by returning it to the merchant who sold the card or the store where the gift card is redeemable.

Gift card fraud is unappealing compared to the latest nation-state threat actors exploiting multiple 0-day vulnerabilities. Still, it is a significant issue that drains funds from retailers and consumers. We can detect scams and protect ourselves by understanding how this fraud is perpetrated.

do you need help?

A lot of those who contact us have questions and concerns about their personal and business data being compromised. We aim to arm you with the legal and technical know-how in the fight against scams. Also, we will be able to refer you to top scam recovery agencies.

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