As one of some 20 million AT&T/DIRECTV customers, Gary Berkland was receptive when he received a call from a company rep offering to discount his monthly DIRECTV rate to just $90 for the next three years.
To qualify, Berkland had to call DIRECTV back and prepay the first five months using an eBay gift card. When he questioned the payment method, Berkland was told it was a special DIRECTV promotion in partnership with eBay.
So, the 73-year-old Harbour Heights resident said he went to Publix and put $450 on an eBay gift card. They’re available at over 100 other locations including Walgreens, CVS, and Target.
Then Berkland called the provided DIRECTV toll-free number, navigating the automatic prompts until he came to “promotions” and provided the gift card information, including the eBay redemption code on the back.
To verify the credit was applied to his account, Berkland subsequently called the DIRECTV customer service number on his bill. That’s when he got the bad news: There was no account credit. No change in his monthly rate. And no eBay promotion.
Berkland was scammed.
He asked me to share his story so others wouldn’t fall victim.
I found similar instances of this DIRECTV scam across the country, especially with Amazon gift cards. It’s prevalent enough that AT&T describes this fraud on its website warning “AT&T/DIRECTV does not solicit prepayments via prepaid cards or gift cards.” An AT&T spokesperson told me in addition, the company has purchased Facebook ads with similar warnings.
Why ask for gift cards?
“Con artists favor these cards because they can get quick cash, the transaction is largely irreversible, and they can remain anonymous,” explains the Federal Trade Commission. “Gift cards and reload cards are now the number one reported method of payment for imposter scams.”
“They might pose as IRS officials and say you’re in trouble for not paying taxes; or a family member with an emergency; or a public utility company threatening to shut off your water; or even a service member selling something before deployment. Or they might call with great news — you’ve won a contest or a prize! But to get it, you need to pay fees with a gift card.”
The numbers are staggering.
In 2018, the FTC reported victims lost $78 million paying fraudsters using a gift or reload card, like MoneyPak. That’s almost twice the amount lost in 2017.
The important takeaway here? Gift cards only should be used to buy gifts, never to make any type of payment.
Since we’re on the subject, when purchasing a gift card, be aware crooks may have tampered with the PIN. So, don’t grab the first one hanging on a rack. Pick from the middle of the pack and check the packaging. Better yet, if possible, purchase it directly from a cashier. Make sure to ask for a gift receipt.
For gift card recipients, immediately verify the balance as soon as you get one. If lost or stolen, gift card issuers may or may not replace it. So, write down the card number, keeping it with the gift receipt if included.
Most important, treat gift all cards like cash and deplete them as quickly as possible. That avoids leaving any unspent forgotten balances or losing a card’s value if the issuing company or business goes out of business.
Finally, think twice before divulging any gift card information — especially if you’re selling one — since a card can quickly be activated and spent before you can do anything. And so long as you’ve accessed the card, the gift card issuer isn’t liable for your loss.
Listing a gift card for sale on Craigslist? Watch out for a scam where the crook buys it using PayPal and then immediately cancels the payment and drains the gift card.
David Morris is the Sun’s consumer advocate. Contact him c/o the Sun, 23170 Harborview Road, Charlotte Harbor, FL 33980; email firstname.lastname@example.org; or leave a message at 941-206-1114.