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By Andrew Eisner

Gift cards have become popular ways of allowing consumers to buy something they really want. With many retailers teetering on the edge of bankruptcy and tech-savvy criminals always looking for a quick buck you have to wonder if good old cash or a check might not be a safer bet this year.

Since there is no personal data encoded on a gift card there is no security risk for individuals buying or using gift cards however there is always a very slight chance that the card you buy will have been targeted by a scammer to rob you of the gift card value.

With just a little bit of precaution and some common sense, gift cards should still be a safe gift this holiday season.

Don't Become an Unsecured Creditor
This year there is an added caution; if you buy a gift card from a retailer that goes on to file for bankruptcy (like Sharper Image and Circuit City) you could be left holding a worthless plastic card. The best advice is to use the card as soon as possible. Bank gift cards can be a safer bet however they tack on extra fees and charges.

Gift Card Scams
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 the numbers 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 mostly immune to these problems but they typically add extra fees.

Safer Gift Card Trading Sites
There are sites that specialize in trading "pre-owned" gift cards Cardavenue, Swapagift and Plastic Jungle 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.
 

Safe guarding against fraud
Some cards include a PIN concealed under a scratch off area that is required when a transaction is made. If a gift card 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.
 

Retrevo for Gadget Gifts
Whether you’re making a budget-friendly gift buying decision this holiday season or splurging on an HDTV, Retrevo has reviews and manuals for popular products like DigitalCameras, GPS, Camcorders, HDTV, and more.
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