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Saturday, June 15, 2019 10:00 AM

Avoid gift card scams this tax season


As the calendar year continues to roll away from us, and the end of June appears just around the corner, most of us are thinking about tax time.  Unfortunately, it also means that criminal groups and scammers will ramp up their never ending ATO impersonation scams.

An ATO impersonation scam usually involves a phone call, where the scammer will pretend to be from the ATO and threaten the victim with a warrant of arrest, or something similar.  The scammer will then demand payment, often via a gift card payment.

Scamwatch reports that losses in 2018 via gift cards was over $5 million, which was a 38% increase from 2017.

Criminals are increasingly using and accepting gift cards as a form of payment, as gift card transactions are extremely hard to trace, while offering the best (or worst) of both cash and credit cards.

A gift card purchased in Brisbane is easily transferred anywhere in the world, and card value can be sold on secondary markets and converted to cash, or quickly converted to property (TV's, gaming consoles, etc), which can then be converted to cash.

Scams using gift cards as payment extend well beyond ATO styled impersonation scams, however.

A large number of Australian businesses have been targeted with these gift card styled scams.  Just one example saw a staff member receiving an email from 'senior management', requesting that gift cards be purchased to pay for property or services.  These targeted staff were instructed to remove the protective cover on the card, revealing the pin, and to scan the details to send to their bosses, the details of which would naturally be received by the scammers instead.

What to do

If you, or members of your family, receive any request for payment using a gift card, always treat it as a scam.

Protect Yourself

  • If you are purchasing gift cards for friends or family, try to purchase the gift card online, directly from the retailer.
  • If you are purchasing gift cards in-store, only purchase cards that are stored behind counters or held in well-sealed packaging.
  • Avoid purchasing gift cards that are stored in easily accessible locations (like racks in department stores or the local service station), as criminals will target these unprotected cards.  They will record the gift card number, remove the protective covering hiding the PIN number, and then apply a new security sticker (easily purchased online) over the PIN, leaving the card looking as new.

  • Report

    Report any losses via card scams through the Australian Online Cyber Reporting Network - 'ACORN' (acorn.gov.au)

    About the Author

    Michael Leboydre has served with the Queensland Police Service, culminating in his time as a Detective with the QPS Cyber Crime Unit. During more than two years with the Cyber Crime Unit, Michael conducted investigations and liaised with other state, national and international Agencies on many cases involving fraud, identity theft and other cyber crimes, including many originating in Queensland and heading interstate or overseas, and coming back the other way.

    As a result of witnessing first hand the impact these crimes have on unsuspecting members of the general public, through investigations and victim statements, Michael has since devoted his time to educate all who will listen on how they can reduce their risk and exposure to these serious crimes and their devastating consequences.

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