How Safe Are Gift Cards?
Since there is no personal data encoded on a giftcard there is no security risk for individuals buying or using gift cards. There is a slight chance that the card you buy will have been targeted by a scammer to rob you of the gift card value.
There have been reports of scammers collecting gift card numbers off gift cards like a Best Buy gift card or a Starbucks gift card in racks at supermarkets, either copying them down or using a handheld magnetic stripe reader to capture the ID number. The scammers then start checking gift card balances periodically while waiting for someone to buy one.
When you purchase the card at the local Safeway or anywhere else, your ID becomes active and now the scammers can use the card number online and drain the funds or in some cases they buy a $5 version of the card and then re-encode the magnetic stripe with your card's ID number. Online, or at the store, the ID appears valid with the amount of money left on your card and once it’s gone, it’s gone.
The good news is there are very few reports of this kind of gift card fraud but you could just be the one in a million that it happens to. Bank issued cards or ones from credit card companies like Visa gift cards or MasterCard gift cards are typically immune to these problems. For more information on gift card fees see Retrevo’s gift card primer.
Buying and Selling Gift Cards on Ebay
You can find gift cards from all kinds of retailers for sale on Ebay. It’s not illegal to buy and sell gift cards. It seems reasonable that someone received a card from a store they didn't need anything from and wanted to sell it. In our opinion it's difficult to tell a legitimate deal from a scam especially on Ebay. You see many reports of buyers claiming the gift card they bought was empty or of sellers sending bogus gift cards. It’s also possible you might be buying a gift card that was purchased with a stolen credit card.
Safer Gift Card Trading Sites
There are sites that specialize in trading "pre-owned" gift cards. Cardavenue and Swapagift specialize in buying, selling, and swapping gift cards. These sites have more thorough registration requirements, they validate gift cards in many cases, and even guarantee many transactions for up to a hundred dollars. Using one of these sites to buy gift cards, sell gift cards, or swap gift cards may be the wiser choice for gift card deals.
Safeguarding Against Gift Card Fraud
Some cards include a PIN concealed under a scratch off area that is required when a transaction is made. If a giftcard comes with a PIN make sure it has not been exposed. You can also look for cards stored behind counters that require a store clerk to give it to you. This works as long as the store clerk isn’t involved in a gift card scam themselves.
For more information on gift card fraud try this article on the Urban Legend site, snopes.
If you do find yourself with a gift card and need help deciding what to spend it on, don’t forget to use Retrevo’s Product Advisor for popular products like digital cameras, GPS, camcorders, HDTV, and more. You can also check out these Retrevo lists of what to buy with a $50 gift card and a $500 gift card.
You can also find reviews and manuals for all popular gadgets and gear at Retrevo.com.