A new law has gone into effect in New York that is aimed at protecting consumers from possible fraud and scams, the state said.
The new law that went into effect on Tuesday requires stores selling gift cards to post signs warning shoppers about possible scammers who could call and message them, asking to be paid in gift cards.
Those types of scams have become increasingly popular. According to a 2022 report from the Federal Trade Commission, nearly 65,000 consumers filed gift card scam-related complaints — costing victims more than $228 million a year.
"We want businesses to comply with the law, and we want to help increase the public’s awareness of these increasingly popular scams, so we encourage any business that has not already done so to post a warning notice where gift cards or displayed or sold," said New York Secretary of State Robert J. Rodriguez.
Gift card scams can take a variety of different forms, the state department warned. Here are a few real examples provided by the state of how scammers have been able to target people:
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- Receiving what appears to be an email from a site like eBay stating that the customer needs to verify their account. In order to complete the verification, the customer is told to buy an eBay gift card and provide the code.
- Buying something off Facebook, with the seller stating they don't accept credit cards. Instead, they instruct the buyer to get Visa gift cards and provide the appropriate numbers and PINs.
- Getting a message from a friend stating they are stranded with a flat tire and need money to the tow truck and new tire. The "friend" will ask if the target can buy a $500 gift card and give them the number and PIN.
- Receiving an email appearing to be from the bank authorizing a large cash transfer overseas. The email will provide a number to call, and the person will instruct the target to to overdraft their account in order to stop the account, telling them to buy gift cards — which would be processed immediately in order to justify the overdraft.
